Getting end of year audits completed can be a fairly smooth or an uphill slog process. Most of the outcome will depend on the type of work you do ahead of the visit of your auditor. It does not matter how many times a firm has undergone the process that the entity should be well prepared. Make certain that you have all the documentation the auditing expert might need. Note that the auditor will use the available documents for their work. They will not give you time to search for missing copies. Plan everything ahead of time to have a smooth procedure. Find out how the experts approach reports. Check out what you can do during audit prep.
Devote additional time to prepare adequately for the auditing process. Clear expectations and proper planning are ideal as they help minimize frustration and anxiety. Business owners should ensure that they are ahead of the curve by treating the preparations as a 12-month long process. Be sure to keep reconciliations and schedules updated throughout the financial year to reduce the time spent in your preparations.
Remember that changes in accounting standards might affect the review of an organization. Make sure that you are up-to-date with the emerging issues. This enables you to track and manage data in a different and better way like reorganizing accounts chart and updating the documentation to implement changes. Identify if your accounting staff need additional information or training to implement new demands.
Make a point of assessing changes in all activities. Determine if your outlet launched a new program or received new grants during the year. Note down the discontinued and impaired activities if any during this period. Remember to add any changes in your internal control systems. Such changes could trigger reporting and accounting considerations to be communicated to the auditing firm.
Use your past experience to learn how to get ready for the next exercise. Take a look at any year adjustments, struggles encountered, and recommendations made on the internal control systems. Use this as a memory jogger and for self-review to ensure you do not repeat mistakes. Meet with the auditors and discuss the previous audits to get professional help on what to improve and adjust.
Review the schedules and work papers the auditors have requested. It is good to seek clarification of the requested details when necessary. Think of assigning each item from your list to the right candidate and add a deadline to complete the task. Give the individuals enough time to review and correct the schedules. You need to start with complex, difficult, and time-consuming areas.
Come up with a repository of the process schedules that can be used later by the appropriate staff. Create subfolders to show significant transaction categories and cycles like cash, expenses and payables, fixed assets, revenue and receivables, and debt. Add a password to protect such data.
Make a point of creating a relationship with the auditor early on. Stay in communication with them to grow the relationship. Seek clarification from auditing company on unclear matters during your preparation. The professionals are ready and happy to respond to accounting queries about infrequent or unusual transactions. Carry out a self-review to verify that recorded amounts reconcile or agree with the trial balance.