Navigating your upcoming audit: A guide for preparation and peace of mind

The mention of an audit can create stress and dread. However, audits are not just a statutory necessity; they’re a golden opportunity for you to take a close look at your financial health and make improvements where needed.

In this blog post, we’ll offer you a guide on how to sail smoothly through your upcoming audit, with a focus on preparation and open communication.

Get your finances in order

Your first port of call is to organise your financial paperwork meticulously.

Auditors are going to need to search through various documents – be it income statements, balance sheets, or even simple bank records. The easier these are to find and examine, the smoother your audit experience will be.

Helpful tips for organising your documents:

• Go digital: In this digital age, paper documents can slow things down considerably. Consider scanning important paperwork and storing them in well-labelled digital folders.
• Reconcile your accounts: Before your audit team arrives, double-check that your internal financial records match up with external records like bank statements.
• Check invoices and receipts: Your auditors may ask for the original invoices and receipts for large expenditures. Make sure these are accessible and align with your accounting software.

Conduct a pre-audit in-house

Before the external auditors set foot in your office, internal housekeeping is highly recommended.

Think of this as a dress rehearsal. It’s your chance to catch any anomalies that might raise red flags later.

In-house review best practices:

• Check compliance: Review your financial documents to ensure they’re in line with relevant laws and accounting standards. The last thing you want is for auditors to flag you for non-compliance.
• Evaluate assets and liabilities: Make sure the values assigned to your assets and liabilities are current and accurate. This may involve some extra work like doing a physical inventory count or scrutinising contracts.
• Seek expert advice: Sometimes, a fresh set of eyes can spot what you’ve missed. Don’t hesitate to consult an external expert for a pre-audit review.

Have transparent conversations with your auditors

Clear, open dialogue with your audit team is the cornerstone of a successful audit.

Fostering good relations with them can be done by:

• Naming a go-to person: Designate someone in your organisation to act as the liaison between your team and the auditors. Make sure this individual is well-versed in your financial matters and can quickly produce any needed documents.
• Provide a workspace: Give your audit team a conducive work environment. A quiet, dedicated space not only aids concentration but also sets the tone for a cooperative relationship.
• Be prompt: If auditors ask for additional information, deliver it as quickly as possible. This not only keeps the audit on schedule but also fosters goodwill.

In conclusion, while audits may seem like a daunting experience, they’re a valuable tool for understanding your business better. Remember, preparation and open communication are your best allies in this process.

If you have further questions or would like more guidance on preparing for an audit, please get in touch.