External FS Audit

Has anyone who has gone through their interim visit from the external auditor noticed drastic changes in procedures performed? We are small enough to avoid the majority of the SOX requirements, however our auditors spend all thier time on internal controls instead of financial statement issues. A look a IC has always been normal, but these people beat it into the ground. They even confirmed balances of customer accounts far more in number than before. Confirmations were becoming obsolete when I got out of public accounting nine years ago.

Has anyone noticed similar issues?

You indicate you "are small enough", but are you publically traded?

We are private.

We are a small bank and same here on external FS procedures. More procedures, more time, etc. This year confirm procedures changed a little but resulted in about the same number of confims as with prior years. Last year we had to pull proof tapes throughout the year and trace the totals to G/L. (Isn't that what daily reconcilements are for?)And this was at the last minute and they told us the guidance had changed. Maybe AICPA?

Even where SOX is not required, it is well on the way to being considered a "best practice." If you're not doing the things required by SOX, they'll probably be recommended. The procedures in use by most auditing firms have been adjusted to reflect SOX. Remember, Arthur Anderson went from being one of the largest and most successful accounting firms in the world to being out of business in a few months. That left a big impression on the senior people in all accounting firms.

Additionally, the auditors who audit non-SOX clients also audit SOX clients. At this point, most auditors probably audit more SOX clients than non-SOX clients. It's very hard for some (if not most) auditors to shift gears and adjust their thinking when going back and forth between SOX and non-SOX clients.