Fee Pressure from Clients: Clients often negotiate lower fees for audit services, especially in industries where competition among firms is high. This puts pressure on firms to manage costs while maintaining high-quality work.
Fixed Fees vs. Workload: Audits are often billed at a fixed fee, but the scope of work can expand due to unforeseen issues or complexities during the audit process. Instead of adjusting the fees, firms may try to absorb this extra work without increasing headcount, resulting in heavier workloads for existing staff.
Efficiency and Utilization: To maintain profitability, firms focus on maximizing staff utilization, meaning they aim to keep employees working at full capacity. This sometimes translates into individuals handling multiple roles or projects, with a lean team structure.
Overheads and Partner Payouts:- Firms must cover operational costs (offices, technology, training) while ensuring competitive payouts to partners and leadership. In many cases, profitability is prioritized over expanding the workforce, which can lead to overburdening employees.
While profitability is a necessary objective, it's the approach to maintaining it that can create undue pressure in the field, often at the expense of work-life balance and employee satisfaction.
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It is with a heavy heart that I offer my condolences on the tragic passing of Anna. My thoughts are with her family, friends and colleagues during this difficult time.
While many are quick to point fingers at EY for the pressures and st...
