In today’s market, the key to business is to be efficient as well as cost effective.
Because of the economic conditions that are currently facing our economy, organizations are struggling to create additional revenue streams, and at the same time, minimize expenses. While the prospects of reducing salaries, advertising costs, or a host of other costs can be frightening and painful, reducing the fees that you pay for your financial statement audit can save your organization significant dollars and can be easy and painless.
Here are 5 simple things you can do to have a more efficient audit and help lower your audit costs:
- 1: Schedule the Audit – Avoid the organization’s peak periods or when key financial personnel are on vacation. Auditors require a lot of time and attention. If you are not available to answer their questions, it will only result in additional time to complete the audit.
- 2: Complete All Requested Work Papers – The greatest cause of inefficiencies and increased fees during the audit is the result of the auditor beginning the audit process before the organization has completed the year-end close process AND has fully completed every single item on the list of items and schedules requested by the auditor. Many organizations feel they can complete the list of requested items as the auditors are working on other areas of the audit. This is rarely the case. As auditors are working through the audit, they will have questions. These will create additional requests that management may have not been prepared for and will delay the preparation of the other items on the list.
- 3: Don’t Be Intimidated – You will be asked about questionable accounting practices or pressures, fraud risk factors, and known deficiencies in accounting systems. Be open with your auditor about difficult areas you have encountered, concerns, questions, and recommendations you may have about your organization. The audit process is a time to improve upon your processes and operations. The auditor cannot provide you with this feedback if they do not know all of the facts and the complete situation.
- 4: Ask for Audit Status Updates – Schedule time to meet with the auditors periodically throughout the audit to learn about the progress of the audit, facilitate communication, resolve issues on a timely basis, and correct any misunderstandings. This is the time to find out if the auditors are getting all the information they need from staff personnel and if the audit is on track. Addressing any concerns or questions early on in the process while the auditor is in the field can save everyone time.
- 5: Complete an Audit Notebook – Keep copies of all spreadsheets and work papers provided to the auditor. Having a notebook will save you and the auditor precious time in creating the work papers for the next year’s audit. If you are paperless, maintain an electronic file of all documents prepared for the audit. Why recreate the wheel year after year?
The key to an efficient audit is PREPARATION. Making sure the organization is prepared for the audit by doing the 5 things listed above can and will result in a smoother and more efficient audit. Just remember, if you prepare, an audit does not have to hit you like a bolt of lightning! Contact Blackman & Sloop if you would like more tips on how to have a more efficient audit or to discuss your auditing needs.
About Blackman & Sloop CPAs, P.A.:
Blackman & Sloop is a full-service CPA firm headquartered in Chapel Hill, North Carolina and is actively involved in auditing, taxation, management consulting, financial planning, and related services. The firm directs a large part of its services toward providing management with advice on budgeting, forecasts, projections, financing decisions, financial analysis, and tax developments. The firm also performs review and compilation services and prepares not-for-profit, corporate, individual, estate, retirement plan, and trust tax returns as well as technology consulting services regarding installation and training on QuickBooks. Blackman & Sloop provides services in Raleigh, Durham, Chapel Hill, RTP, Hillsborough, Pittsboro, Charlotte, and the rest of North Carolina. To find out more please visit http://www.blackmansloop.com
Contact: CPA firstname.lastname@example.orgToll Free: 1-877-854-7530 The Exchange West 1414 Raleigh Rd, Suite 300 Chapel Hill, NC 27517