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July 14, 2008

AGN International strives to distinguish group as an association

A mid-tier association has revealed it went to great lengths to appear more like an association of independent firms following a decision not to join the Forum of Firms.

AGN International, the 18th-largest accountancy group in last year’s International Accounting Bulletin world survey, introduced a series of strategies in order to be regarded as an association, including asking member firms to rebrand without the AGN initials and a new quality control system.

The association’s chief executive, Nick Blake, said AGN had been pondering whether to become a network or remain an association for a number of years, but as the Forum of Firms deadline loomed, a “hard decision” was made to remain an association.

AGN’s decision to continue down the association path was motivated by several factors that were cost, liability and business related.

“Not only from a cost viewpoint, but also from an operational viewpoint,” Blake said. “Would all member firms give the necessary information in order to make it a worthwhile and realistic database? We felt that wasn’t going to be the case and the cost of putting that in place and maintaining it was going to be exorbitant.”

Setting up a conflict identification system within the organisation was another motivating factor.

A consequence of remaining an association has been the introduction of a new strategy on quality control procedures.

“Once firms become members we can’t undertake, within AGN, peer reviews and the monitoring of quality and quality standards,” Blake said, while stressing the association does implement quality standards.

To overcome this problem, AGN draws on quality reviews by regulators where possible. In the markets where regulators do not perform audit reviews, AGN commissions independent firm reviews in accordance with the International Federation of Accountants’ ISQC1 – Quality Control for Audit, Assurance and Related Services Practices.

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