The managers and partners [who] were interviewed listed reduced manpower costs as the major advantage for utilizing paraprofessionals [in CPA firms]. It seems that these savings were realized in a number of ways. First, there were significant savings in the salaries of paraprofessionals when compared with new staff professionals.

Furthermore, since a large number of paraprofessionals were employed for less than 40 hours, many firms were realizing a significant savings in fringe benefit cost. As one manager indicated,

"When we want to review inventory, we always try to get our paraprofessional because of his experience in the use of the audit guide, insights on inventory procedures, and level of training." Partners and managers indicated that the part-time nature of the employment agreement for most paraprofessionals offered the firm greater flexibility in scheduling work around peak business periods and aided in reducing hours that cannot be billed.

Certainly, the savings discussed above can have a significant impact on dwindling profit margins or can be passed on to the client in the form of reduced fees. As indicated [in this article], the billing rate for accounting paraprofessionals [was much lower for paraprofessionals for both large and small firms].

Quality of work, especially on job assignments that require a large amount of detailed and repetitive tasks, was also cited on several occasions as a major consideration when employing accounting paraprofessionals. The fact that paraprofessionals are able to spend longer periods of time on jobs and their willingness to do repetitive tasks may explain the improved quality of work of paraprofessionals.

As one manager stated, "The quality of work of our paraprofessionals far exceeds that of our new staff professionals." Some of the practitioners who were interviewed still expressed concerns about utilizing paraprofessionals and the legal implications of using "less than qualified" individuals on audits. When considering using paraprofessionals on audit engagements, an argument could be advanced that the use of "less than competent audit personnel" is a violation of auditing standards. Of course the basic question is: Do these individuals possess the technical attributes one would normally expect of individuals working in that capacity?

a. Discuss the use of part-timers and paraprofessionals from the perspective of controlling costs.

b. How could the use of part-timers and paraprofessionals impair the quality of work performed by public accounting firms?

c. Is it ethical for a CPA firm to bill the time of paraprofessionals at the same rate as fully qualified professionals? Discuss.

d. How could the use of part-timers and paraprofessionals affect the effectiveness and efficiency of work performed in public accounting firms?