Computer auditor

              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that its contents were withdrawn only occasionally, he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
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