Audits are a critical part of business operations, ensuring transparency, compliance, and trustworthiness in financial reporting. However, they can often be time-consuming, stressful, and expensive if not properly managed. One of the most effective ways to ensure a smooth audit is by actively assisting your auditor throughout the process. When you work collaboratively and proactively, you not only make the auditor’s job easier but also reduce your own organizational stress. Here’s a detailed guide on how to help your auditor achieve a quick and easy audit.
1. Start Preparing Early
Preparation is the foundation of an efficient audit. As soon as your fiscal year ends—or even before—begin gathering necessary documentation. Make sure financial records are updated, reconciled, and organized. Early preparation gives you enough time to identify and resolve any inconsistencies, correct errors, and fill in missing information before the auditors arrive.
Creating an internal timeline with key deadlines, such as when trial balances should be ready or when schedules need to be reviewed, helps ensure that your team is aligned and ready before the audit officially begins.
2. Understand the Auditor’s Requirements
Communication with the auditor ahead of time is key. Most auditors provide a Prepared by Client (PBC) list, detailing all the information, documents, and records they will need. Familiarize yourself with this list thoroughly. If any item is unclear, reach out early for clarification rather than making assumptions. Understanding precisely what is needed helps you prepare targeted, complete documentation without wasting time.
Also, review prior year audit findings, if any, and address these issues before the current audit to avoid recurring problems.
3. Organize Your Documentation
An audit can slow down drastically when documents are scattered or incomplete. Think of your audit file as a well-organized library. Documents should be:
- Clearly labeled
- Grouped logically (e.g., cash, receivables, payables)
- Indexed for easy reference
Use folders (physical or digital) based on audit sections and sub-sections. Proper naming conventions like “2024_AP_Aging_Summary” make retrieval faster and prevent confusion.
Additionally, provide reconciliations and tie-outs where possible. For example, if you submit a bank statement, also provide the corresponding bank reconciliation and ledger report, neatly linked to each other.
4. Assign a Knowledgeable Point of Contact
Your auditor will need to ask clarifying questions or request additional documentation. Assign a single, knowledgeable point of contact (POC) to liaise with the audit team. This person should be familiar with the financials, systems, and internal controls and be empowered to gather information quickly.
Having a dedicated POC prevents miscommunications and ensures that requests are responded to quickly and consistently. It also avoids the confusion of multiple people answering the same question differently.
5. Be Transparent
Auditors appreciate honesty and openness. If there are issues, such as accounting estimates that are particularly subjective, missing records, or past errors, disclose them early. Trying to hide or delay problematic information will only complicate and extend the audit.
Transparency builds trust with the auditor and often allows minor issues to be resolved informally instead of escalating them into formal findings.
6. Streamline Access to Systems
If your auditor needs access to your accounting system or other digital records, make sure it is arranged ahead of time. This could mean setting up a temporary user login with appropriate permissions or designating someone to retrieve system reports on request.
System bottlenecks—such as slow approval chains or unavailable reports—waste audit time and frustrate everyone involved. Make sure IT, finance, and other relevant departments are ready to provide any needed support immediately.
7. Prepare Supporting Schedules and Reports
Wherever possible, prepare detailed schedules that summarize large volumes of information. For example:
- A fixed asset rollforward showing additions, disposals, and depreciation
- A detailed aged accounts receivable report
- A breakdown of accrued liabilities
Supporting schedules should not only summarize the data but should also reconcile back to your general ledger balances. When auditors can easily trace numbers from the financial statements to the detailed support, they can complete their work much faster.
8. Review Internal Controls Before the Audit
A significant part of any audit is the assessment of internal controls. Review your key control activities before the auditors arrive:
- Are approvals documented?
- Are reconciliations performed and reviewed timely?
- Are segregation of duties maintained?
Providing auditors with updated narratives or flowcharts of processes like purchasing, cash disbursement, and payroll can speed up their understanding of your environment and reduce testing time.
9. Respond Promptly to Requests
Speed matters. Once auditors begin fieldwork, their timeline is tight. Delays in providing documents or answers lead to extended audit time and sometimes additional fees. Aim to respond to requests the same day or within 24 hours whenever possible.
If a request cannot be completed quickly, communicate immediately with a realistic estimated delivery time. This allows the auditor to reorder their work and avoid idle time.
10. Facilitate Physical Observations and Confirmations
Some audits require physical inventory counts, fixed asset inspections, or external confirmations (like customer receivables or bank balances). Assist auditors in arranging these activities by:
- Scheduling site visits in advance
- Making sure inventory is properly organized
- Pre-notifying vendors, customers, or banks about incoming confirmation requests to expedite their responses
Well-coordinated logistics reduce disruptions to both the auditor’s and your own operations.
11. Encourage a Positive and Cooperative Atmosphere
Audits can feel intrusive, but maintaining a positive, professional demeanor creates a more cooperative environment. Simple acts like providing a clean, quiet workspace for auditors, being available for questions, and treating them courteously can dramatically affect the tone and efficiency of the audit.
Remember, auditors are partners in ensuring that your financial statements accurately reflect your organization’s reality—not adversaries.
12. Debrief Post-Audit
Once the audit concludes, schedule a debrief meeting with your auditor. Discuss what went well and where improvements could be made. Understanding the auditor’s feedback can make future audits even smoother and faster.
Use this information to refine your internal processes, update PBC templates, and train staff before the next audit cycle begins.
Conclusion
Helping your auditor achieve a quick and easy audit is a combination of early preparation, open communication, systematic organization, and professional cooperation. When you invest time in preparing thoroughly, stay responsive, and maintain a collaborative mindset, audits become not just easier but also an opportunity to strengthen your internal financial processes. A well-conducted audit doesn’t just save time and money—it builds credibility, trust, and a stronger organization.