Audit readiness checklist for lean finance teams

Finance teams are getting leaner, and are increasingly focused on developing automation and strategic reporting which often leaves little space for the audit cycle which is, in turn, becoming more complex and pressured. FCA scrutiny on audit firms to improve quality has added to the workload and documentation that companies must prepare, which creates further stress for the finance team. 

Being on the back foot when your audit starts can result in required documents being poorly prepared, increased year-end adjustments and many time-consuming discussions with auditors around the quality of data and deliverables. Delays risk not getting the information to your stakeholders on time, which can result in unwanted consequences and extra costs. And spending time meeting auditors’ requests takes finance teams and operational departments away from the day-to-day work supporting key decisions and financial operations of the business.

We’ve prepared a checklist of things to consider to help your audit go smoothly.

Checklist – Are you ready for your audit?

The following checklist, collated by our Financial Accounting Advisory Services (FAAS) team, is designed to help you through the process of completing your statutory audit on time:

• Meet with auditors to set up timeline and expectations
• Make sure you have enough resource available within your finance team during the three different stages of an audit: planning, fieldwork and reporting
• Identify who will project manage the audit delivery. This needn't be your most senior person but it does require someone highly organised, with the gravitas and mandate to instruct both junior and senior staff, an ability to build relationships and a respectful communication style
• Agree up front with the auditors how queries and requests will be communicated (such as by email, cloud or a document holder tool)
• Prepare and gather information in advance such as accounting policies and process notes, making sure to review them for accuracy and how recently they have been updated
• Flag any changes to your operations and new accounting standards you have applied, with your auditors
• Encourage regular reconciliations within your team and investigate any differences from the year in advance of your year end, as this is a key area of focus for your auditors
• Ensure you have the right evidence to support the closing balances and that these have been reviewed internally before being provided to the auditors, to avoid reworking them mid-audit.
• Consider recent Financial Reporting Council (FRC) guidance, and economic and market trends within your sector to help identify areas of likely auditor focus that might require more supporting evidence 

Getting support with your audit

Whatever the scale and complexity your finance team are facing in this year’s audit, our FAAS team can take the difficulty out of the audit process.  Our service brings clarity, support and additional bandwidth to ensure day to day objectives in the audit are delivered.   We work seamlessly alongside your teams by expanding your finance function temporarily with on demand resource and access to reporting experts to provide technical guidance.

Next steps

By improving the quality of documentation and the bandwidth within your finance team, you have the opportunity to reduce delays as well as reduce the potential for over-runs being charged by your auditors. Taking pro-active and practical steps now will help make the audit process easier and less painful.

For more insight and guidance, get in touch with Rosamond Murphy.