With audit season around the corner, Rosamond Murphy sets out a checklist for how to get audit-ready and reduce stress on the finance team at this time.
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The trend towards leaner finance teams, with a focus on automation and internal or strategic reporting, can leave little bandwidth for the audit cycle. In addition, FCA scrutiny on audit firms to improve quality has added to the work load and documentation that companies must prepare. All of which creates stress for the finance team. 

Furthermore, a lack of audit readiness can result in poor preparation of required documents, an increase in year-end adjustments, and many discussions with auditors around the quality of documents 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 developing and increasing the operations of the company.

Follow our checklist for what you need to do to get through an audit, followed by three key areas where you can get some additional audit support for your team.

 

Checklist for audit readiness

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 resources during the three different stages of 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
  • Communication clearly with the auditors how queries and requests will be communicated (eg, email, cloud or a document holder tool)
  • Prepare and gather information in advance such as accounting policies and process notes
  • Discuss any changes to your operations or new accounting standards with 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 documents to support the closing balances and that these have been reviewed internally before being provided to the auditors to avoid reworking them mid-audit.

 

Getting support with your audit

Whatever your scale, complexity and preparedness, our FAAS team can take the difficulty out of the audit process and manage complex or technical challenges, allowing you to focus on your day-to-day responsibilities and key reporting deadlines. We provide support with finance placement, financial reporting advice, and environmental social and governance (ESG) assurance.

Finance placement

We offer a placement service where our professionals embed themselves in your business, become trusted team members, and provide you with additional skills and expertise. We work together with your finance team to understand your challenges, go through the audit deliverables, and help you deliver the audit in a timely and efficient manner.

Placement examples:

  • Experienced individuals to project manage the audit process, take on most of the interactions with the auditors, discuss audit methodologies and ensure the audit is being run as efficiently as possible
  • A dedicated team who can manage the audit process, respond to audit queries and liaise with your team to collate the appropriate information
  • Qualified individuals who can review documents, including the closing reconciliations, to ensure they meet the auditor's requirements and quality standards
Financial reporting advisory

We have a broad understanding of both best practice and how financial reporting can go wrong. Together with our technical knowledge of IFRS, UK GAAP and US GAAP, and capital markets insight, this means we can provide you with access to experts to help you balance demands and challenges within your team. With our global network of firms, we can support you across the globe across whichever GAAP you report under.

Examples of financial reporting areas that may require support:

  • Preparation of accounting policy manual and policy reviews
  • Technical accounting papers, such as revenue recognition, share-based payments, business combinations and financing arrangements
  • Complex accounting questions regarding accounting standards and transactions
  • Preparing complex financial statements under IFRS and consolidated group accounts
  • Tailoring training to your employees for new standards
  • Conversion of financial statement to different GAAP and GAAP adjustments
ESG assurance

The landscape of sustainability reporting is developing rapidly. We work closely with you to gather the right information, build the right controls around data and help you build the right report. It's also important to align your practices with the relevant sustainability standards to ensure the information you present in your sustainability report, including ESG, follows best practice, and is clear and concise.

Key support areas:

  • Assisting in setting up the process to collate the data for accurate and timely reporting
  • Providing training on the requirements of the legal and regulatory frameworks
  • Preparing a gap analysis report to identify what's missing from your current reporting compared to minimum compliance and best practice

 

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.

Learn more about how our Financial accounting advisory services (FAAS) services can help you
Supporting your finance team with financial reporting expertise and providing scalable resource to navigate change

Learn more about how our Financial accounting advisory services (FAAS) services can help you

Visit our Financial accounting advisory services (FAAS) page

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