SUMMER INTERNSHIP PROJECT ON

Management control in auditing firms and its

implications for managing coexisting objectives
Undertaken at

M.V. Shah & Company

Submitted in partial fulfillment of the requirement for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

BATCH (2023-25)

Submitted by Name of the Industry Mentor

Dhananjay Kushwah Viren Rajput
MBA Semester III (Chartered Accountant)
2306172000690

Under the Guidance of

Dr. Rinki Mishra

(MFT)

PARUL UNIVERSITY
FACULTY OF MANAGEMENT STUDIES
P.O. Limda, Tal. Waghodia, District Vadodara – 391760
Declaration

I Dhananjay Kushwah with Enrollment No. 2306172000690 am a student of the MBA program,
Semester III at Parul Institute of Management & Research, Parul University, Vadodara. I hereby
declare that my Summer Internship Report, entitled "Management control in auditing firms and its
implications for managing coexisting objectives" is my own original work. This work has not been
submitted to any other institution for the award of any degree or certification.

Date:

Signature:

[Dhananjay Kushwah]
FACULTY OF MANAGEMENT
STUDIES

INSTITUTE CERTIFICATE

It is hereby certified that Dhananjay Kushwah, 2306172000690 has submitted the Summer
Internship Project Titled – Management control in auditing firms and its implications for
managing coexisting objectives. In partial fulfillment of Master of Business Administration
(PIMR) at Faculty of Management Studies – MBA, Parul University, Vadodara, Gujarat.

The internship was carried out at M.V. Shah & Company from 15/06/2024 to 31/07/2024
The report submitted satisfactorily meets all the criteria.

Date: 24/08/2024

Dr. Rinki Mishra Dr. Bijal Zaveri

Assistant Professor Dean and Director (FMS)
PREFACE

I will discuss my experiences from my internship term in this report. A summary of the internship
company and the activities, duties, and projects I worked on during my internship are included in the
internship report. As I write this report, I’ll also discuss and reflect on the learning objectives and
personal objectives I established for my internship. I wanted to present a synthesis of theoretical
frameworks and strategies for applying them in the commercial world when I put this paper together.
I have made an effort to understand the connection between theoretical and practical knowledge.

The gap between theoretical presumptions and real-world requirements has been my goal. We remain
involved in theoretical learning, with academic success as the major goal, throughout the entirety of
our academic education. Only via the practical application of hypothetical ideas, which we learn
from our academic activities, can one have a thorough understanding of the contemporary corporate
environment. With these goals in mind, I have done everything within my power and the research
necessary to deliver my article in a well-informed shape in a remarkably short amount of time. I did
my utmost to ensure that the document was error-free. My internship had to be finished quickly, thus
the study acknowledges its limits. The report must first provide a technical summary of the work
done during the internship.

The obtained results will next be examined and discussed. with technical specifics throughout the
internship duration. The gathered results are then discussed and examined. In the report, future
projects that could be seen as improvements on the current work will also be covered in detail. I did
my best to keep the report clear and accurate in all technical respects. I hope my effort is successful.
ACKNOWLEDGEMENT
The Summer Internship was an experiential growth opportunity for learning and skill development. I
am also grateful to get a chance of meeting with industry professionals who led me for the successful
completion of the internship. I am using this opportunity to express my gratitude towards my mentor,
Viren Rajput (Chartered Accountant) who in spite of being busy with her duties, took out time to
guide me in the right direction. I would like to sincerely thank Dr. Bijal Zaveri (Dean & Director) for
providing an opportunity to gain professional experience at Blue Hole and supporting me to give my
best. Lastly, I would like to express my gratitude towards friends and family. This opportunity has
been a great milestone in my career development.

Last but not least, I am really ever grateful to my parents, who remained a constant source of
encouragement and inspiration during the completion of this work successfully in Parul University,
Waghodia.
INDEX

Sr. No. Particulars Page

No.

Chapter INDUSTRY STUDY 1-9

1
1.1 Sector Overview and Strategic Analysis 1-4
1.2 Key Market Players 5-6
1.3 Growth Prospects and Opportunities 7-9
Chapter 10-13
COMPANY STUDY
2
2.1 Company Overview 10
2.2 Mission and Vision Statements 10
2.3 Service Offered 10
2.4 Financial and Operational Performance 11
2.5 SWOC Analysis 12-13
Chapter DEPARTMENTAL STUDY 14-15
3
3.1 Organizational Structure Overview 14
3.2 Departmental Activities Overview 15
3.3 Intern’s Roles and Responsibilities 15
Chapter RESEARCH WORK 16-27
4
4.1 Problem Identification / Significance of the Study 16
4.2 Research Objectives 16
4.3 Literature Review 17
4.4 Research Gaps 18
4.5 Recommendations & Suggestions 18
4.6 Bibliography / References 19-27
Chapter Learning & Skills Acquired 28-33
5
5.1 Learning’s and Value Addition 28-29
5.2 Acquired Skills Overview 30-31
5.3 Challenges and Limitations 32-33
Chapter 1
Industry Study

1.1 Sector Overview & Strategic Analysis

Industry Dynamics:

• Market Size and Growth: The CA industry has a steady demand due to statutory
requirements for auditing, tax filing, and financial reporting. The industry sees moderate
growth driven by economic growth, regulatory changes, and increasing complexity in
financial transactions.
• Key Services Offered: Auditing and assurance, tax advisory, financial consulting, risk
management, forensic accounting, and compliance services.
• Regulatory Environment: Highly regulated by professional bodies (e.g., ICAI in India) and
government regulations. Compliance with accounting standards, auditing standards, and
ethical guidelines is mandatory.
• Technology Impact: Increasing use of technology such as data analytics, cloud accounting,
and AI in auditing and financial reporting. Tech adoption enhances efficiency but also requires
investment in skills and infrastructure.

Porter’s Five Forces of Strategic Analysis

Forces Factors to Consider Analysis

Competitive Rivalry - Number of Competitors - Number of Competitors:
- Industry Growth Many CA firms ranging
- Product Differentiation from large firms to small
- Switching Costs independent practitioners.
- Industry Growth:
Moderate growth; firms
compete for market share.
- Product Differentiation:

1
Services are similar, but
reputation and client
relationships are key
differentiators.
- Switching Costs: Low for
clients, leading to intense
competition for retaining
clients.
Threat of New Entrants - Barriers to Entry - Barriers to Entry:
- Government Policy Moderate; requires
- Brand Loyalty professional qualifications
- Access to Technology and registration with
regulatory bodies.
- Government Policy:
Compliance with strict
regulatory standards
required.
- Brand Loyalty: High for
established firms due to
trust and reputation.
- Access to Technology:
Essential but accessible,
reducing entry barriers
slightly.
Bargaining Power of - Number of Suppliers - Number of Suppliers:
Suppliers - Uniqueness of Service Mainly tech providers and
- Switching Costs specialized service vendors.
- Supplier Integration - Uniqueness of Service:
Moderate; differentiation
based on service quality and
integration.
- Switching Costs:
Moderate for tech and
service providers.

2
- Supplier Integration:
Limited integration with
suppliers.

Bargaining Power of Buyers - Number of Buyers - Number of Buyers:

- Product Importance Diverse client base from
- Switching Costs individuals to large
- Price Sensitivity corporations.
- Product Importance:
High; essential for
compliance and strategic
decision-making.
- Switching Costs: Low;
clients can easily switch CA
firms.
- Price Sensitivity:
Moderate; clients may seek
competitive pricing but also
value expertise and
reliability.
Threat of Substitutes - Availability of Substitutes - Availability of
- Price-Performance Trade- Substitutes: Low; legal
off requirement for CA services
- Switching Costs in auditing and compliance.
- Buyer Propensity to - Price-Performance
Substitute Trade-off: Moderate;
automated software for
basic accounting but not a
full substitute for
professional services.
- Switching Costs: Low for
basic services but higher for
specialized advisory
services.

3
- Buyer Propensity to
Substitute: Low for core
auditing and compliance
services.

Strategic Recommendations

1. Differentiation through Expertise: Focus on niche areas such as forensic accounting,

international tax, or risk management to differentiate from competitors.
2. Technology Adoption: Invest in the latest accounting software, data analytics tools, and AI to
improve efficiency and offer value-added services.
3. Client Relationship Management: Build strong client relationships through excellent
service, personalized advice, and proactive communication.
4. Brand Building: Enhance brand reputation through thought leadership, quality certifications,
and active participation in professional bodies.
5. Talent Management: Attract and retain top talent by offering continuous professional
development, competitive compensation, and a supportive work environment.
6. Service Diversification: Expand service offerings to include financial consulting,
management advisory, and business strategy to reduce dependency on traditional audit and tax
services.

4
1.2 Key Market Players

Key Market Players in the Chartered Accountancy Sector

1. Big Four Accounting Firms:

These are the largest and most well-known firms globally, providing a wide range of services
including audit, tax, consulting, and advisory.

- Deloitte: Known for audit, consulting, advisory, and tax services. Deloitte is the largest of the Big
Four in terms of revenue.
- PricewaterhouseCoopers (PwC): Offers services in audit, assurance, consulting, and tax. PwC is
known for its extensive network and comprehensive service offerings.
- Ernst & Young (EY): Specializes in assurance, tax, consulting, and advisory services. EY has a
strong focus on innovation and digital transformation.
- KPMG: Provides audit, tax, and advisory services. KPMG is known for its industry-specific
expertise and global reach.

2. Mid-Tier Accounting Firms:

These firms have a significant regional presence and offer a broad range of services. They are often
considered alternatives to the Big Four.

- BDO: Offers audit, tax, advisory, and consulting services. BDO has a strong international presence
and is known for its personalized service.
- Grant Thornton: Provides audit, tax, advisory, and consulting services. Grant Thornton is recognized
for its focus on dynamic organizations.
- RSM: Specializes in audit, tax, and consulting services. RSM is known for its middle-market focus
and global network.

- Mazars: Offers audit, accounting, tax, and advisory services. Mazars is notable for its integrated
global partnership model.

3. Regional and Local Firms:

These firms cater to specific geographic regions and often have deep local market knowledge.

5
- Crowe Horwath: Provides audit, tax, advisory, risk, and performance services. Crowe is known for
its expertise in various industries and local market insights.
- Nexia International: Offers audit, tax, advisory, and consulting services. Nexia has a strong regional
presence and a collaborative network.
- Baker Tilly: Specializes in audit, tax, and advisory services. Baker Tilly is recognized for its client-
centric approach and industry specialization.
- Moore Global: Provides audit, accounting, tax, and advisory services. Moore Global is known for its
entrepreneurial spirit and local expertise.

4. Boutique Firms and Specialized Practices:

These firms focus on niche areas such as forensic accounting, international tax, or specific industries.

- Alvarez & Marsal: Known for restructuring, performance improvement, and advisory services. They
have a strong focus on turnaround and crisis management.
- Frazier & Deeter: Offers audit, tax, advisory, and consulting services. They are known for their
specialization in private companies and high-net-worth individuals.
- Andersen: Provides tax, valuation, financial advisory, and consulting services. Andersen focuses on
high-quality client service and extensive expertise in tax and advisory.

Competitive Landscape
- Service Differentiation: Firms differentiate themselves based on service quality, industry
specialization, technological adoption, and client relationships.
- Market Focus: While the Big Four dominate the global market, mid-tier and regional firms often
compete by providing more personalized services and focusing on specific industries or regions.
- Innovation and Technology: Adoption of advanced technologies such as AI, blockchain, and data
analytics is a key competitive factor. Firms that invest in technology can offer more efficient and
insightful services.

- Regulatory Compliance: Adherence to evolving regulatory standards and maintaining high ethical
standards are critical for all firms to sustain credibility and client trust.

6
1.3 Growth Prospect & Opportunities

1. Technological Advancements:

• Automation and AI: Implementing AI and machine learning can streamline routine tasks
such as data entry and analysis, reducing time and costs.
• Data Analytics: Using advanced analytics to offer deeper insights into financial data, helping
clients with strategic decision-making.
• Cloud Accounting: Adopting cloud-based accounting solutions for real-time access to
financial information and enhanced collaboration with clients.

2. Advisory and Consulting Services:

• Business Advisory: Expanding services to include business strategy, financial planning, and
management consulting.
• Risk Management: Offering risk assessment and management services to help clients
navigate uncertainties and regulatory changes.
• Sustainability Consulting: Providing advice on sustainability practices and ESG
(Environmental, Social, and Governance) compliance.

3. Specialized Services:

• Forensic Accounting: Developing expertise in forensic accounting to investigate financial

discrepancies and fraud.
• International Taxation: Offering specialized services in international tax planning and
compliance to cater to multinational clients.
• Mergers and Acquisitions: Providing due diligence, valuation, and advisory services for
M&A activities.

4. Industry Focus:

• Sector-Specific Expertise: Building expertise in specific industries such as healthcare,

technology, real estate, and manufacturing to provide tailored services.
• Startups and SMEs: Focusing on startups and small-to-medium enterprises (SMEs) for
growth opportunities, offering scalable services to meet their evolving needs.

7
5. Geographic Expansion:

• Local Market Penetration: Expanding presence in under-served regions within the domestic
market.
• Global Expansion: Establishing partnerships or branches in international markets to cater to
global clients and tap into emerging markets.

6. Regulatory Changes:

• Compliance and Reporting: Keeping up-to-date with regulatory changes and offering
services to help clients comply with new standards and regulations.
• IFRS and GAAP: Assisting clients in transitioning to International Financial Reporting
Standards (IFRS) or Generally Accepted Accounting Principles (GAAP).

7. Client Relationship Management:

• Value-Added Services: Providing additional services such as financial education, training,

and workshops to build long-term relationships with clients.
• Customer Experience: Enhancing client experience through personalized service, regular
communication, and feedback mechanisms.

8. Talent Management:

• Professional Development: Investing in continuous professional development and training

for staff to stay ahead of industry trends and changes.
• Talent Acquisition: Attracting and retaining top talent through competitive compensation,
career development opportunities, and a positive work culture.

9. Marketing and Branding:

• Digital Presence: Strengthening online presence through digital marketing, social media, and
content marketing to reach a wider audience.
• Thought Leadership: Publishing research, whitepapers, and case studies to establish the firm
as a thought leader in the industry.

8
10. Collaborations and Alliances:

• Strategic Partnerships: Forming alliances with other professional service firms, tech
companies, and industry bodies to offer comprehensive solutions.
• Networking: Actively participating in industry associations and networks to stay connected
with peers and potential clients.

Actionable Steps

1. Invest in Technology: Implement AI, data analytics, and cloud accounting solutions.
2. Expand Service Offerings: Develop advisory and consulting services, focusing on
specialized areas such as forensic accounting and international taxation.
3. Industry Specialization: Build expertise in key industries and tailor services to meet sector-
specific needs.
4. Geographic Expansion: Explore opportunities for local and global market expansion.
5. Enhance Client Relationships: Offer value-added services and enhance the client
experience.
6. Talent Development: Focus on professional development and attracting top talent.
7. Strengthen Brand: Enhance digital presence and establish thought leadership through
research and publications.
8. Form Strategic Alliances: Collaborate with other firms and industry bodies for
comprehensive solutions.

9
Chapter 2
Company Study

2.1 Company Overview

Introduction to the Company:

Name: M.V. Shah & Company

Establishment: 1970

Full Address: 503-504 Neptune Edge, Neptune Campus Vikram Sarabhai Road,
Wadivadi, Gujarat 390007

2.2 Mission and Vision Statements

To provide full range of high-quality services in Auditing, Accounting, Taxation, Company Law
Matters & Management Consulting and to carry out all aspects of our work with high level of
professionalism and excellence to offer value for money for the services we provide.

2.3 Service Offered

Auditing & Assurance

Taxation

Advisory Service

Accounting & Bookkeeping

Corporate Finance

Business Consulting

NRI Service

10
2.4 Financial & Operational Performance

The financial and operational performance of a Chartered Accountancy (CA) firm like M.V. Shah &
Company is crucial for assessing its effectiveness and market position. Over the past three years,
M.V. Shah & Company has demonstrated steady revenue growth, with a focus on maintaining robust
profitability through efficient cost management and strategic client engagements. Operational
efficiency metrics, including client retention rates and project completion times, reflect the firm's
commitment to delivering high-quality services. Challenges such as navigating regulatory changes
and managing operational costs have been addressed through proactive measures aimed at enhancing
service delivery and maintaining competitive pricing. Looking ahead, the firm aims to further
leverage technological advancements and expand its service offerings to sustain its growth trajectory
in a competitive market landscape.

11
2.5 SWOC Analysis

Strengths

1. Reputation and Trust: Established brand with a strong reputation for reliability and integrity
in financial services.
2. Expertise and Experience: Deep industry knowledge and experienced professionals in
various fields of accounting, auditing, and taxation.
3. Client Relationships: Strong client retention and satisfaction due to personalized service and
attention to client needs.
4. Technological Integration: Effective use of technology such as accounting software, data
analytics, and cloud computing to enhance service delivery and efficiency.
5. Strategic Partnerships: Collaborations with legal firms, financial institutions, and industry
specialists to provide comprehensive solutions.

Weaknesses

1. Limited Geographic Reach: Presence primarily in regional markets, limiting exposure to

larger national and global opportunities.
2. Dependency on Key Clients: Reliance on a few major clients for significant revenue, posing
risks during client turnover.
3. Staff Turnover: High turnover rate among junior staff impacting project continuity and client
relationships.
4. Cost Structure: Higher operational costs compared to larger firms, affecting competitiveness
in pricing.
5. Regulatory Changes: Vulnerability to changes in accounting and taxation regulations,
requiring continuous adaptation.

Opportunities

1. Market Expansion: Potential to expand into new geographic markets or niche sectors (e.g.,
healthcare, technology) to diversify client base.
2. Service Diversification: Offering new services such as forensic accounting, sustainability
reporting, and international tax planning to meet evolving client demands.
3. Digital Transformation: Leveraging AI, blockchain, and machine learning for enhanced
service delivery and client insights.

12
4. Mergers and Acquisitions: Opportunities to acquire smaller firms or merge with strategic
partners to expand market share and service offerings.
5. Global Partnerships: Forming alliances with international firms to access global clients and
expertise in cross-border financial services.

Challenges

1. Competitive Pressure: Intense competition from larger global firms (Big Four) with
extensive resources and brand recognition.
2. Technological Adoption: Keeping pace with rapid advancements in technology and ensuring
staff training and integration.
3. Client Expectations: Meeting increasingly complex client expectations for real-time data
analytics, customized reporting, and advisory services.
4. Talent Acquisition: Attracting and retaining top talent amidst industry-wide competition for
skilled professionals.
5. Economic Volatility: Exposure to economic downturns impacting client spending and
demand for financial services.

13
Chapter 3

Departmental Study

3.1 Organizational Structure Overview

M.V. Shah & Company operates under a well-defined organizational structure designed to facilitate
efficient service delivery and client management. The organizational chart reflects a hierarchical
framework with clear reporting lines and functional departments. At the top level, the firm is led by
the Managing Partner, who oversees overall operations, strategic direction, and client relationships.

Under the Managing Partner, the leadership team includes Partners responsible for specific
departments such as Audit, Taxation, Advisory, and Administration. Each department is headed by a
Department Head or Director who manages day-to-day operations and client engagements within
their respective areas of expertise.

Supporting these core departments are functional units including Human Resources, Finance, IT, and
Marketing, each contributing specialized services crucial to the firm's operational effectiveness and
growth strategy. This structured approach ensures coordination across departments, efficient resource
allocation, and consistent service delivery aligned with M.V. Shah & Company's mission to provide
comprehensive and client-centric financial solutions.

14
3.2 Departmental Activities Overview

Within M.V. Shah & Company, each department plays a crucial role in delivering specialized
financial services and ensuring client satisfaction. So, I’m serving to the Audit department

Audit Department:

The Audit Department is responsible for conducting financial audits, ensuring compliance with
regulatory standards, and providing assurance services to clients. Activities include conducting risk
assessments, preparing audit reports, and offering recommendations for improving internal controls
and financial reporting processes.

3.3 Intern’s Roles and Responsibilities

As an intern at M.V. Shah & Company, you will be actively involved in various departmental
activities, gaining hands-on experience and contributing to the firm's operations. Your roles and
responsibilities will vary based on the department you are assigned to, but typical responsibilities may
include:

Audit Department:

• Assisting in conducting audit procedures under the guidance of senior auditors.

• Performing substantive testing and verifying financial records.
• Drafting audit reports and preparing work papers for review.

15
Chapter 4

Research Work

4.1 Problem Identification / Significance of the Study

This study tells about several important tensions that exist in auditing firms. The professional-
commercial tension has received most attention; however, more recent literature also starts to
recognize the importance of exploitation-exploration tensions in auditing firms. Auditing research
has shown that management control

systems play a key role in the management of professional and commercial objectives in auditing
firms while mainly focusing on results-based management control elements.

4.2 Research Objective

1. Different types of management control each have an impact on auditor behavior and decision-
making

2. Coexisting objectives exist, the interrelation of different control elements is important and argues
that different management controls can together form a dynamic system.

3. Results-based and value-based management control elements play an important role in managing
process innovations in auditing firms with a key responsibility of senior levels to actively promote
innovation and learning.

16
4.3 Literature Review

This literature review summarizes several important tensions that exist in auditing firms. The
professional-commercial tension has received most attention; however, more recent literature also
starts to recognize the importance of exploitation-exploration tensions in auditing firms. Auditing
research has shown that management control systems play a key role in the management of
professional and commercial objectives in auditing firms while mainly focusing on results-based
management control elements. Several auditing studies however also highlight the importance of
studying a broader range of management controls, including value-based controls such as common
beliefs and tone at the top. Management control literature set in other contexts also provides valuable
insights. This literature shows how in contexts where coexisting objectives exist, the interrelation of
different control elements is important and argues that different management controls can together
form a dynamic system. In this context, the Merchant and Van der Stede framework is especially
suitable as it allows for a clean and unambiguous classification of different control elements. In the
context of exploitation-exploration tensions, the management control literature on ambidexterity
provides a theoretical foundation for studying these tensions in the auditing context and it is
expected that both results-based and value-based management control elements play an important
role in managing process innovations in auditing firms with a key responsibility of senior levels to
actively promote innovation and learning.

Applying the findings from the management control literature to the auditing context can yield
important insights into how different elements within the management control system in auditing
firms are interrelated (complexity), how these interrelations develop over time (dynamics), and how
the management control system is used to Manage tensions between coexisting objectives.
Development of these insights also responds to the call from management control researchers for
more empirical studies that investigate management control systems and organizational tensions in-
depth and close to practice (e.g., Lewis and Smith, 2014; Merchant and Otley, 2020). Given that
previous management control studies show that outcome measurability and organizational design
have a considerable effect on the management control configuration (e.g., Bedford and Malmi, 2015;
Bedford et al., 2016; Ouchi, 1979), studying the auditing context is expected to yield new insights
regarding management Control in contexts with coexisting goals and low performance clarity.

17
4.4 Research Gaps

1. More detail studies are needed to see implications for managing coexisting objectives.

2. There is a need to better understand how management control works in auditing firms.

4.5 Recommendations & Suggestions

1. Evaluate and Improvise image management

2. Conduct Comprehensive Impact Assessments and informal communication

3. Increase Focus on selection and training processes by Create special programs

4. Track the long-term success and intuition of audit partners

18
4.6 Bibliography / References
AFM (2017). Quality of PIE audit firms. Published by the Autoriteit Financiële Markten
(AFM) on 28 June 2017

Alberti, C. T., Bedard, J. C., Bik, O. & Vanstraelen, A. (2020). Audit firm
culture: recent developments and trends in the literature. European Accounting
Review, December 2020

Alles, M. G. (2015). Drivers of the use and facilitators and obstacles of the evolution of Big
Data bythe audit profession. Accounting Horizons, 29(2), pp. 439-449

Andiola, L. M., Downey, D. H. & Westermann, K. D. (2020). Examining climate and culture
in audit firms: insights, practice implications, and future research directions. Auditing: A
Journal of Practice & Theory, 39(4), pp. 1-29

Bamber, E. M. & Iyer, V. M. (2007). Auditors’ identification with their clients and its
effect on auditors’ objectivity. Auditing: A Journal of Practice & Theory, 26(2), pp. 1-
24

Bauer. T. D. (2015). The effects of client identity strength and professional identity salience
on auditorjudgments. The Accounting Review, 90(1), pp. 95-114

Becharov, M. L. & Smith, W. K. (2014). Multiple institutional logics in organizations:

explaining theirvaried nature and implications. The Academy of Management Review, 39(3),
pp. 364-381

Bedford, D. S. (2015). Management control systems across different modes of

innovation: implications for firm performance. Management Accounting Research,
28, pp. 12-30.

Bedford, D. S. (2020). Conceptual and empirical issues in understanding management control

combinations. Accounting, Organizations and Society, 86

Bedford, D. S., Bisbe, J. & Sweeney, B. (2019). Performance measurement systems as

19
generators ofcognitive conflict in ambidextrous firms. Accounting, Organizations and
Society, 72, pp. 21-37

Bedford, D. S. & Malmi, T. (2015). Configurations of control: an exploratory analysis.

Management Accounting Research, 27, pp. 2-26

Bedford, D. S., Malmi, T. & Sandelin, M. (2016). Management control effectiveness and
strategy: anempirical analysis of packages and systems. Accounting, Organizations and
Society, 51, pp. 12-28

Bobek, D. D., Dalton, D. W., Daugherty, B. E., Hageman, A. M. & Radtke, R. R.

(2017). An investigation of ethical environments of CPAs: public accounting versus
industry. Behavioral Research in Accounting, 29(1), pp. 43–56.

Brattström, A. & Richtnér, A. (2014). Good cop-bad cop: trust, control, and the lure of
integration.
Journal of Product Innovation Management, 31(3), pp.584-598

Broberg, P., Umans, T., Skog, P. & Theodorsson, E. (2018). Auditors’ professional and
organizational identities and commercialization in audit firms. Accounting, Auditing &
Accountability Journal, 31(2), pp. 374-399

Buchheit, S., Pasewark, W. R. & Strawser, J. R. (2003). No need to compromise: evidence of

public
accounting’s changing culture regarding budgetary performance. Journal of Business Ethics,
42(2), pp.151-163

Church, B. K., Jenkins, J. G., McCracken, S. A., Roush, P. B. & Stanley, J. D. (2015).
Auditor independence in fact: research, regulatory, and practice implications drawn from
experimental and archival research. Accounting Horizons, 29(1), pp. 217-238

Coram, P. J. & Robinson, M. J. (2017). Professionalism and performance incentives in

accounting firms. Accounting Horizons, 31(1), pp. 103-123

20
Curtis, E. & Sweeney, B. (2017). Managing different types of innovation: mutually
reinforcing management control systems and the generation of dynamic tension.
Accounting and Business Research, 47(3), pp. 313-343.

Daglienė , L. & Klovienė, L. (2019). Motivation to use Big Data and Big Data analytics in
external auditing. Managerial Auditing Journal, 34 (7), pp. 750-782

Dalton, D. W., Davis, A. B. & Viator, R. E. (2015). The joint effect of unfavorable
supervisoryfeedback environments and external mentoring on job attitudes and job
outcomes in the public accounting profession. Behavioral Research in Accounting,
27(2), pp. 53–76

Dennis, S. A. & Johnstone, K. M. (2018). A natural field experiment examining the joint role
of audit partner leadership and subordinates’ knowledge in fraud brainstorming. Accounting,
Organizations and Society, 66, pp. 14-28

Dirsmith, M. W. & Covaleski, M. A. (1985). Informal communications, nonformal

communications and mentoring in public accounting firms. Accounting, Organizations and
Society, 10(2), pp. 149-169

Englund, H. & Gerdin, J. (2015). Developing enabling performance measurement systems:

on the interplay between numbers and operational knowledge. European Accounting Review,
24(2), pp. 277-303

Epstein, M. J., Buhovac, A. R. & Yuthas, K. (2015). Managing social, environmental and
financialperformance simultaneously. Long Range Planning, 48, pp. 35-45

Ernstberger, J., Koch, C., Schreiber, E. M. & Trompeter, G. (2020). Are audit firms’
compensation policies associated with Audit Quality? Contemporary Accounting Research,
37(1), pp. 218-244

Fredberg, T. (2014). If I say it’s complex, it bloody well will be: CEO strategies for
managing paradox. The Journal of Applied Behavioral Science, 50(2), pp. 171-188

21
Friis, I., Hansen, A. & Vámosi, T. (2015). On the effectiveness of incentive pay: exploring
complementarities and substitution between management control system elements in a
manufacturing firm. European Accounting Review, 24(2), pp. 241-276

Gerdin, J., Johansson, T. & Wennblom, G. (2019). The contingent nature of complementarity
between results and value-based controls for managing company-level profitability: a
situational strength perspective. Accounting, Organizations and Society, 79

Grabner, I. & Moers, F. (2013). Management control as a system or a package?

Conceptual and empirical issues. Accounting, Organizations and Society, 38, pp. 407-
419

Granlund, M. & Taipaleenmäki, J. (2005). Management control and controllership in new

economy firms–a life cycle perspective. Management Accounting Research, 16, pp. 21-57

Griffith, E. E., Kadous, K., Proell, C. A. (2020). Friends in low places: how peer advice and
expectedleadership feedback affect staff auditors’ willingness to speak up. Accounting,
Organizations and Society, 87

Guénin-Paracini, H., Malsch, B. & Tremblay, M-S. (2015). On the operational reality of
auditors’ independence: lessons from the field. Auditing: A Journal of Practice & Theory, 34(2),
pp. 201-236

Guo, K. H. (2016). The institutionalization of commercialism in the accounting

profession: An identity-experimentation perspective. Auditing: A Journal of Practice &
Theory, 35(3), pp. 99-117

Hall, M. & Smith, D. (2009). Mentoring and turnover intentions in public accounting firms: a
research note. Accounting, Organizations and Society 34, pp. 695–704.

Henri, J-F. (2006). Management control systems and strategy: a resource-based perspective.
Accounting, Organizations and Society, 31, pp. 529-558

22
Jans, M., Alles, M. & Vasarhelyi, M. (2013). The case for process mining in auditing: sources
of value added and areas of application. International Journal of Accounting Information
Systems, 14, pp. 1-20

Jenkins, J. G., Deis, D. R., Bedard, J. C. & Curtis, M. B. (2008). Accounting firm
culture and governance: a research synthesis. Behavioral Research in Accounting,
20(1), pp. 45-74

Jeppesen, K. K. (2007). Organizational risk in large audit firms. Managerial Auditing

Journal, 22(6),pp. 590-603

Johansen, T. R. & Christoffersen, J. (2017). Performance evaluations in audit firms:

evaluation foci and dysfunctional behaviour. International Journal of Auditing, 21, pp. 24-
37

Knechel, W. R., Krishnan, G. V., Pevzner, M., Shefchik, L. B. & Velury, U. K. (2013).
Audit quality: insights from the academic literature. Auditing: A Journal of Practice &
Theory, 32(1), pp. 385-421

Koch, C. & Salterio, S. E. (2017). The effects of auditor affinity for client and perceived client
pressure on auditor proposed adjustments. The Accounting Review, 92(5), pp. 117-142

Kraus, K., Kennergren, C. & Von Unge, A. (2017). The interplay between ideological control
and formal management control systems–a case study of a non-governmental organisation.
Accounting, Organizations and Society, 63, pp. 42-59

Lander, M. W., Koene, B. A. S. & Linssen, S. N. (2013). Committed to professionalism:

organizational responses of mid-tier accounting firms to conflicting institutional logics.
Accounting, Organizations andSociety, 38, pp. 130-148

Lewis, M. W. & Smith, W.K. (2014). Paradox as a metatheoretical perspective: sharpening

the focus and widening the scope. The Journal of Applied Behavioral Science, 50(2), pp. 127-
149

23
Limperg, T. (1933). De functie van den accountant en de leer van het gewekte vertrouwen.
Maandbladvoor Accountancy en Bedrijfshuishoudkunde, 10, pp. 193-197

Long, C. P. (2018). To control and build trust: how managers use organizational controls
and trust- building activities to motivate subordinate cooperation. Accounting,
Organizations and Society, 70, pp. 69-91

Lövstål, E. & Jontoft, A-M. (2017). Tensions at the intersection of management

control andinnovation: a literature review. Journal of Management Control, 28, pp.
41-79

Lukkezen, J. (2020). Commerciële druk leidt tot standaardisatie. Published in the ESB report
‘Accountants doorgelicht’ (July, 2020)

Malmi, T. & Brown, D. A. (2008). Management control systems as a package–

opportunities, challenges and research directions. Management Accounting Research,
19, pp. 287-300

Martinov-Bennie, N. & Pflugrath, G. (2009). The strength of an accounting firm’s ethical

environment and the quality of auditors’ judgments. Journal of Business Ethics, 87(2), pp.
237–253

McManus, L. & Subramaniam, N. (2014). Organisational and professional commitment of

early career accountants: do mentoring and organisational ethical climate matter? Accounting
and Finance, 54, pp. 1231–1261

McNair, C. J. (1991). Proper compromises: the management control dilemma in public

accounting and its impact on auditor behavior. Accounting, Organizations and Society, 16(7),
pp. 635-653

Meckfessel, M. D. & Sellers, D. (2017). The impact of Big 4 consulting on audit

reporting lag and restatements. Managerial Auditing Journal. 32(1), pp. 19-49

24
Merchant, K. A. & Otley, D. (2020). Beyond the systems versus package debate.
Accounting, Organizations and Society, 86

Merchant, K. A. & Van der Stede, W. A. (2017). Management control systems:

performance measurement, evaluation and incentives. Pearson Education Limited,
Harlow (UK)

Müller-Stewens, B., Widener, S. K. & Möller, K. (2020). The role of diagnostic and
interactive control uses in innovation. Accounting, Organizations and Society, 80

Mundy, J. (2010). Creating dynamic tensions through a balanced use of management control
systems.
Accounting, Organizations and Society, 35, pp. 499-523

Nehme, R. (2017). Performance evaluation of auditors: a constructive or a destructive tool

of audit output. Managerial Auditing Journal, 32(2), pp. 215-231

Otley, D. T. & Pierce, B. J. (1995). The control problem in public accounting firms: an
empirical study of the impact of leadership style. Accounting, Organizations and Society,
20(5), pp. 405-420

Ouchi, W. G. (1979). A conceptual framework for the design of organizational control

mechanisms.
Management Science, 25(9), pp. 833-848

Pache, A-C. & Santos, F. (2010). When worlds collide: the internal dynamics of
organizational responses to conflicting institutional demands. The Academy of Management
Review, 35(3), pp. 455- 476

Pfister, J. A. & Lukka, K. (2019). Interrelation of controls for autonomous motivation: a field
study ofproductivity gains through pressure-induced process innovation. The Accounting
Review, 94(3), pp.
345-371

25
Picard, C.-F., Durocher, S. & Gendron, Y. (2018). The colonization of public accounting
firms by marketing expertise: processes and consequences. Auditing: A Journal of Practice
& Theory, 37(1), pp. 191-213

Pickerd, J. S., Summers, S. L. & Wood, D. A. (2015). An examination of how entry-level

staff auditors respond to tone at the top vis-à-vis tone at the bottom. Behavioral Research
in Accounting, 27(1), pp. 79-98

Pierce, B. & Sweeney, B. (2004). Cost-quality conflict in audit firms: an empirical investigation.
European Accounting Review, 13(3), pp. 415-441

Pierce, B. & Sweeney, B. (2005). Management control in audit firms–partners’ perspectives.

Management Accounting Research, 16, pp. 340-370

Power, M. K. (2003). Auditing and the production of legitimacy. Accounting,

Organizations and Society, 28, pp. 379-394

Pruijssers, J. L., Heugens, P. P. M. A. R. & Van Oosterhout, J. (2020). Winning at a losing

game? Side-effects of perceived tournament promotion incentives in audit firms. Journal of
Business Ethics, 162, pp. 149-167

Simons, R. (1995). Levers of Control. Harvard Business School Press, Boston (USA)

Simsek, Z. (2009). Organizational ambidexterity: towards a multilevel understanding.

Journal ofManagement Studies, 46(4), pp. 597-624

Smith, W. K. & Lewis, M. W. (2011). Toward a theory of paradox: a dynamic equilibrium

model oforganizing. The Academy of Management Review, 36(2), pp. 381-403

Spence, C. & Carter, C. (2014). An exploration of the professional habitus in the Big 4
accounting firms. Work, Employment & Society, 28(6), pp. 946-962

Stephenson, D. (2018). Big Data demystified. Pearson Education Limited, Harlow (UK)

26
Sundin, H., Granlund, M. & Brown, D. A. (2010). Balancing multiple competing
objectives with abalanced scorecard. European Accounting Review, 19(2), pp. 203-246

Sweeney, B. & McGarry, C. (2011). Commercial and professional audit goals: inculcation
of audit seniors. International Journal of Auditing, 15, pp. 316-332

Tuomela, T-S. (2005). The interplay of different levers of control: a case study of
introducing a newperformance measurement system. Management Accounting Research,
16, pp. 293-320

Van Brenk, H. & Renes, R. (2020). Haal de commerciële prikkels uit de markt voor
accountantscontrole. Published in the ESB report ‘Accountants doorgelicht’ (July, 2020)

Vandenhaute, M-L., Hardies, K. & Breesch, D. (2020). Professional and commercial

incentives in audit firms: evidence on partner compensation. European Accounting
Review, 29(3), pp. 521-554

Van der Kolk, B., Ter Bogt, H. J. & Van Veen-Dirks, P. M. G. (2015). Constraining and
facilitating management control in times of austerity; case studies in four municipal
departments. Accounting, Auditing & Accountability Journal, 28(6), pp. 934-965

Van der Kolk, B., Van Veen-Dirks, P. M. G. & Ter Bogt, H. J. (2020). How combinations
of control elements create tensions and how these can be managed: an embedded case study.
Management Accounting Research, 48

Vasarhelyi, M. A., Kogan, A. & Tuttle, B. M. (2015). Big Data in accounting: An overview.
Accounting Horizons, 29(2), pp. 381-396

Wyatt, A. R. (2004). Accounting professionalism–they just don’t get it! Accounting

Horizons, 18(1), pp. 45-53

27
Chapter 5
Learning & Skills Acquired

5.1 Learning’s & Value Addition

Reflecting on my internship experience at M.V. Shah & Company, a Chartered Accountancy firm, I
can confidently say that the knowledge gained and the values added to my professional and personal
development have been substantial. This experience provided me with hands-on exposure to the
practical applications of theoretical knowledge, allowing me to bridge the gap between academic
learning and the real-world demands of the accounting and finance industry.

Professional Development

1. Auditing: Auditing was key area where I gained hands-on experience. I assisted in performing both
internal and external audits, which involved examining financial records, assessing internal controls,
and ensuring that companies' financial practices complied with statutory regulations. This experience
enhanced my analytical skills, as I had to critically evaluate financial information and identify
discrepancies or irregularities.

2. Attention to Detail: The meticulous nature of accounting and auditing work cultivates a strong attention to
detail, essential for ensuring accuracy and compliance in financial reporting.

3. Taxation: The internship also provided exposure to taxation, an area that is both complex and
crucial in the realm of accountancy. I learned how to prepare tax returns for individuals and
businesses, ensuring that they comply with tax laws and regulations. This task not only improved my
understanding of tax planning and compliance but also taught me the importance of attention to detail,
as even minor errors can have significant financial implications.

4. Communication Skills: Regular interaction with clients and colleagues helps in honing communication
skills, both written and verbal. Explaining complex financial information in a simple manner is a valuable skill
that is developed during the internship.

28
Personal Development

1. Self-Discipline & Responsibility: One of the most profound impacts of the internship was the
development of self-discipline. The structure and demands of the work environment at the C.A. firm required
me to be punctual, meet strict deadlines, and maintain a high level of productivity throughout the day. This
experience instilled in me the importance of adhering to schedules, staying focused on tasks, and managing
time efficiently. These habits, developed in the professional realm, have seamlessly transferred to my personal
life, helping me manage my time better and maintain a balanced lifestyle.

2. Resilience and Stress Management: The fast-paced environment of a C.A. firm can be demanding,
with periods of high workload, tight deadlines, and the pressure to deliver accurate results. Navigating
these challenges required developing resilience—a key trait that allows one to remain composed and
effective in the face of stress.

3. Long-Term Thinking: I learned that ethical decisions often require long-term thinking, considering the
broader implications of actions on clients, the firm, and society at large. This approach to decision-making has
influenced my personal life, encouraging me to think more deeply about the consequences of my actions and
make choices that are sustainable and ethical in the long run.

4. Confidence and Independence: Handling responsibilities and working on tasks independently boosts self-
confidence. The experience of being trusted with important tasks fosters a sense of accountability and
professional pride.

5. Networking and Relationship Building: The internship provides opportunities to build professional
networks, including relationships with mentors, colleagues, and clients. These connections can be invaluable
for future career opportunities.

29
5.2 Acquired Skills Overview
During an internship at a Chartered Accountancy (C.A.) firm, students develop a robust combination
of technical skills and value-based skills, both of which are critical for their professional and personal
growth.
Technical Skills
Accounting Proficiency: Interns gain hands-on experience in preparing financial statements,
managing ledgers, and performing reconciliations. They become proficient in applying accounting
principles like IFRS and GAAP, enhancing their ability to manage and interpret financial data
accurately.

Audit and Assurance: Exposure to various audit procedures, such as vouching, verification, and risk
assessment, equips interns with the ability to conduct thorough audits. They learn to identify
discrepancies, ensure compliance, and provide recommendations for improving financial practices.

Taxation Knowledge: Practical experience in preparing and filing tax returns, understanding GST,
TDS, and other tax-related regulations, is another key skill gained. Interns learn to navigate the
complexities of tax compliance and planning, essential for minimizing tax liabilities for clients.

Financial Analysis: Interns develop the ability to perform ratio analysis, budgeting, and forecasting,
which are crucial for evaluating company performance and supporting decision-making processes.
This analytical skill set is vital for assessing financial health and guiding strategic business decisions.

Use of Accounting Software: Familiarity with accounting software like Tally, QuickBooks, or ERP
systems is a significant technical skill acquired. Interns learn to efficiently manage financial data,
automate processes, and generate accurate financial reports, making them adept at handling modern
accounting tools.

30
Value-Based Skills
Ethical Integrity: Working in a C.A. firm in stills a strong sense of professional ethics and
confidentiality. Interns learn the importance of honesty, transparency, and safeguarding sensitive
information, which is fundamental for maintaining trust and credibility in the profession.

Teamwork and Collaboration: The internship experience emphasizes the importance of working
effectively in teams. Interns develop interpersonal skills through collaboration with colleagues and
client interaction, learning to communicate clearly, share responsibilities, and contribute to collective
goals.

Problem-Solving and Critical Thinking: Interns are trained to analyze complex financial data, identify
issues, and propose solutions. This enhances their critical thinking and decision-making abilities,
enabling them to tackle challenges effectively and make informed judgments in real-world scenarios.

Time Management: The fast-paced environment of a C.A. firm teaches interns to manage their time
efficiently. They learn to prioritize tasks, balance multiple responsibilities, and meet deadlines, which
is crucial for maintaining productivity and ensuring the timely completion of assignments.

Communication Skills: Interns enhance both their verbal and written communication skills. They
learn to articulate complex financial concepts in a clear and concise manner, whether in client
meetings, team discussions, or through written reports and documentation.

31
5.3 Challenges and Limitations
Reflecting on an internship at M.V. Shah & Company, several limitations and challenges often
surface, ranging from personal to logistical and institutional barriers. These challenges provide
valuable learning experiences but can also present significant hurdles during the internship.

Personal Challenges

Initial Lack of Experience: Entering the internship with limited practical experience posed a challenge
in adapting to the complex tasks at hand. The theoretical knowledge gained in academic settings did
not always translate seamlessly into real-world applications. Overcoming this required active
learning, seeking guidance from mentors, and gradually building confidence through hands-on tasks.

Time Management: Balancing the demands of the internship with academic responsibilities or
personal life was challenging. The high workload, coupled with tight deadlines, often led to stress and
fatigue. Improving time management skills, such as prioritizing tasks and creating a structured daily
routine, helped mitigate these issues. However, the pressure of meeting deadlines remained a constant
challenge throughout the internship.

Communication Barriers: Initially, articulating complex financial concepts in a clear and concise
manner, especially to clients or senior colleagues, was daunting. The fear of making mistakes or
miscommunicating added to the stress. With time and practice, communication skills improved, but
the challenge of conveying technical details in simple terms was an ongoing hurdle.

Logistical Challenges

Access to Resources: Depending on the size and resources of the C.A. firm, access to the latest
accounting software, tools, or databases could be limited. This restriction sometimes hindered the
ability to perform tasks efficiently or learn new technologies that are standard in larger firms. To
address this, leveraging available resources to the fullest and seeking online tutorials or self-study
materials became necessary, though the lack of direct access to advanced tools remained a limitation.

Work Environment: The physical workspace or the availability of necessary infrastructure, such as
adequate seating, computer systems, or access to private spaces for client meetings, occasionally
posed logistical challenges. In some cases, the workspace was cramped or lacked the necessary quiet

32
environment for focused work. While adapting to these conditions was possible, it occasionally
impacted productivity and comfort.

Travel and Commute: The daily commute to the firm, especially in congested urban areas, often led to
delays and added stress. The unpredictability of travel time occasionally affected punctuality and
reduced the time available for completing tasks. While adjusting schedules to leave earlier helped, the
commute remained a persistent challenge that was difficult to fully overcome.

Institutional Challenges

Limited Exposure to Diverse Tasks: In some cases, the firm’s focus on specific areas, such as auditing
or taxation, limited the exposure to other aspects of accounting and finance. This lack of diversity in
tasks could restrict the breadth of learning during the internship. To address this, expressing interest
in different areas to supervisors and volunteering for varied tasks helped gain broader experience,
although opportunities were sometimes limited by the firm's scope of work.

High Expectations and Workload: The high expectations from interns, often involving complex tasks
with limited guidance, created a steep learning curve. The pressure to perform well while managing a
heavy workload led to stress and occasional burnout. Seeking feedback, asking for help when needed,
and gradually increasing task complexity helped manage this challenge, though the workload
intensity remained high throughout.

Structured Learning Opportunities: Some firms may lack a structured training or mentorship program,
which can leave interns feeling unsupported. Without a clear learning path, navigating tasks
independently became challenging. Building relationships with colleagues and proactively seeking
mentorship helped, but the absence of a formal support system was a limitation that persisted

33