Club Management - September/October 2007 - (Page 31) being audited has not maintained GAAP” (Qualified Opinion, 2007). There seems to have been some confusion as to the definition of a qualified audit, which was not included in the survey instrument. It is hard to believe that more than 30 percent of the respondents received a qualified audit opinion; therefore, the results of this question appear to be invalid. Contact with Auditing Firm. There are many variables that can impact the cost of an audit. Some would argue that ongoing contact between the club and auditing firm throughout the year can decrease audit fees; therefore, a question was included in this survey to determine how many times throughout the year respondent clubs contacted their audit firm. Out of the 246 responses to this question, 103 indicated that they contact their audit firm one to three times per year. Seventy-nine respondents contacted their auditing firm four to six times per year, followed by 30 that had no contact, and 34 that contacted their auditing firm seven or more times throughout the year. In this particular survey, there was not a significant difference in audit fees for those es- tablishments that spoke to their auditors throughout the year. Annual Review Fees. In total, approximately 200 of the respondents provided numerical fee data. Through detailed analysis it was determined that annual revenue was the factor that contributed most to the cost of an audit. Annual audit fees steadily increased up to the enactment of the new audit standards on December 16, 2006. The only exception was for clubs earning between $5 and $10 million a year. This category experienced a slight decrease in 2006. Survey participants also were asked to provide current audit fee data, as of December 16, 2006, which would reflect the new audit requirements. On average, 102 club properties reported that their annual audit fees will increase by 0.8 percent; while 18 properties which receive a review or compilation reported a decrease of 2.9 percent for 2007. It is interesting to note that survey participants are indicating that they are experiencing minimal increases or even decreases after the new audit standards. A better gauge of the impact of new audit standards will probably be seen by the end of this year when all clubs have experienced the changes. Several of the major audit firms have reported that client fees will increase somewhere between 15 percent and 40 percent due to the new audit standards. This increase can be attributed to an increase in costs endured by the audit firm because the average audit requires more time and staffing. If you would like further information on this survey or have any questions about the results, contact the HFTP Research Institute. ❚❘ About the author Tanya Venegas, MBA, MHM, is program director of the HFTP Research Institute at the University of Houston. SOURCES: • Qualified Opinion. (2007). Retrieved August 19, 2007 from www.investopedia.com. • Walker, S. (2007, Winter). ASB’s Road to Harmonization. In Our Opinion … the newsletter of the AICPA Audit and Attest Standards Team. Retrieved June 5, 2007 from http:// www.aicpa.org / Professional+Resources/ Accounting+and+Auditing/Audit+and+Attes t+Standards/Opinion SEPTEMBER/OCTOBER 2007 • 31 http://www.investopedia.com http://www.aicpa.org/Professional+Resources/Accounting+and+Auditing/Audit+and+Attest+Standards/Opinion http://www.aicpa.org/Professional+Resources/Accounting+and+Auditing/Audit+and+Attest+Standards/Opinion http://www.aicpa.org/Professional+Resources/Accounting+and+Auditing/Audit+and+Attest+Standards/Opinion http://www.uspta.com/
For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.