Most audit firms operating in Ukraine today are members of international networks or associations. At the same time, only the concept of “audit network” appears in the profile law. What are the main differences between networks and associations? How important can such differences be for Ukrainian audit firm, as evidenced by the international experience of associations in professional communities and how to achieve effective membership in both the network and the association?
Network: rules of play
When choosing a professional association, it is important to clearly understand its features. Thus, the international professional network provides for the use of a single brand - members of one network have the same name, corporate style, specifics of advertising materials, and so on. When choosing a network, keep in mind that you will have to completely obey the rules of the head office.
Most of the companies that are part of network are separate legal entities, however, they are subordinated to the main offices and governing bodies that coordinate their activities. In addition to centralized management, network members share common service delivery standards, methodological materials, and even a common software product. Such requirements allow its representatives from different countries to take part in one project, which is very convenient when providing services to the international clients.
There is a single service quality control system for all network members. For the most part, it is part of a software product that is mandatory for use. Violations are subject to a system of sanctions, and in the case of serious and systematic violations such member may be even expelled from the network.
The process of becoming a member of a professional audit network is quite difficult. It is preceded by a thorough examination, after which you can get your dream international status. The head office prefers to work with market leaders who are able to ensure the maintenance of corporate network standards.
The policy of international professional networks is focused on maximizing the territory of their presence, so by attracting new members, they focus on the need to strengthen their position in a country. As a rule, networks have one representative in each country. Although today there are exceptions to this unwritten rule.
Despite the limitations of independence, membership in networks has many significant advantages. Thus, a local audit firm can use a world-famous and powerful brand, adding to its status. But the most important thing is that the head office “shares” customers, so a member of the international network will not be left without work. Good prospects open up for the professional development of staff. Exchange of employees within the network is a common phenomenon.
The largest professional networks are already represented in Ukraine.
How association and alliances work
Forms of professional partnership such as associations or alliances, which are essentially synonymous, are more flexible than networks. There is no single name for all members, common corporate identity, website design, centralized management, etc. At the same time, members of professional associations use uniform service standards, have the right to borrow methods and regulations for work. However, the association does not demand anything, but only recommends. Its members remain independent in their activities. Still, the association periodically monitors the quality of services provided by its members. Some internal documents are mandatory. For example, communication policy, features of brand use, membership standards, etc.
Unlike professional networks, the association is not limited to one representative in a country. The policy is different: the more members in one country, the stronger the position of the association.
There is no single software product for network members. Often the association may recommend a program, but this requirement is not imperative. Many member firms of the association are interested in using the same software product, as it gives them access to international projects and clients. As for the latter, there are no constant “direct deliveries”. It is unlikely that the association can hand over its client, if the client has applied directly to the main office of the association and it is most convenient to serve him through the firm of a particular member.
In addition, members of the association often invite their colleagues to carry out joint projects, especially when you need a highly qualified specialist or unique experience. However, working on expanding the customer base as a member of an association or alliance needs is done differently.
Throughout the year, the association holds conferences in various parts of the world. The management and key employees of the audit firm are interested in such events. For example, trends in the global market of audit services, features of working with clients, trends in the promotion of audit services and more. Participation in such events is also effective for promoting the company and attracting new customers, because there the useful acquaintances are made. However, you need to be active and sociable. Passive observation will not help.
World practice confirms that professional networks and associations are equal participants in the market of audit services. They carry out one mission, but in different ways. If the network does not provide a choice, the association provides it.
Such professional associations have the same status, but different mechanisms of operation. In the market, they complement each other, and, competing with each other, ensure the constant development of audit.