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By Colin Park ' About forty years ago a young accountant working at a banana plantation in Central America was sent out around the railroad sidings to account for freight cars, which were in short supply. The list he brought back was neatly prepared and thorough. But in drawing it up, he had failed to think about and call attention to an alternative use for a box-car sitting at the end of a line, loaded with dynamite to be used on a construction project. "For a few pesos," said his boss, "a hut thatched with banana leaves could be thrown up to store the dynamite, and that box-car could be back hauling bananas." Several years later the accountant, now on our staff and with this lesson firmly lodged in his memory, went out on the audit of a chemical company. When he found a tank-car standing in a corner of the plant and learned that its contents were withdrawn only occasionally, he quickly suggested constructing a storage tank at the site so that the tank-car could be released for other services. Unfortunately for his idea, he was told rather scathingly that the demurrage on the tank-car was only $2 or $3 a day, and to build a tank for the corrosive liquid it held would cost $20,000. It might surprise some of our readers to learn that the accountant in this melancholy tale not only continued his career with the Firm but progressed to become a partner in charge of one of our larger offices. Quite evidently, he had learned from this experience and others with happier endings that constructive services develop naturally out of auditing services; that they depend on experience and thinking things through; and that you can't win them all. One thing he didn't have to learn was enthusiasm, and it was very early in the game that he realized that constructive service is fundamental to and as old as auditing itself. A Systematic Approach In 1959 Mr. Queenan asked Richard H. Grosse of Pittsburgh to work with Philip J. Sandmaier, Jr., who was then in the Executive Office, on plans for the next principals' meeting which would be devoted almost in its entirety to the theme, "A Constructive Approach to Client Services"—since contracted to Constructive Services. The reason for the emphasis was not to foster a new line of service—it was not new—but to recognize how changes in the times have affected the approach. One change, for example, lies in the shorter time that new accountants are out in the field before they are charged with running audits. This is possible because today's more selective college education gives would-be CPAs a better preparation than ever before. But it is this very field experience that counts the most in developing a man's instinct for rendering constructive service. So we have to plan to make the most of this shortened time. Another change lies in the tremendous increase in the number of things auditors have to know about—a much greater body of tax rules, procedures of the SEC and regulations of other government agencies, plus an ever-increasing common body of accountancy knowledge. All these things may have to be dealt with in buttoning-down an audit. But everything is not buttoned down unless you can look back and say to yourself "I brought to the client's attention every idea I thought might be useful to him—I squeezed out every last bit of information for his benefit." The benefits can be substantial. In the case of a consumer finance company our senior accountant suggested closer analysis of the need for operating cash in each of 200 branch offices. As a result of this suggestion, the company found it was possible to transfer $4,000,000 excess cash to the home office for reinvestment. This is 4
Park, Colin I.
Auditing -- Data processing
Park, Colin I.
Queenan, John W.
Sandmaier, Philip J.
Grosse, Richard H.
Park, Colin I.
Haskins & Sells. Executive Office
Haskins & Sells. Pittsburgh Office
H&S Reports, Vol. 02, (1965 spring), p. 04-07
|Source||Originally published by: Haskins & Sells|
|Rights||Copyright and permission to republish held by: Deloitte; Photograph by Roy Stevens|
|Format||PDF page image with corrected OCR scanned at 400 dpi|
|Collection||Deloitte Digital Collection|
|Digital Publisher||University of Mississippi Library. Accounting Collection|