Are you prepared for an audit of your business? An audit can be a scary prospect, but if you are prepared, it can be a lot less daunting.
Understand the type of audit your business might undergo
The most common types of audits are financial, compliance and operational. Financial audits focus on your company’s financial statements. Compliance audits focus on whether you are complying with regulations. Operational audits focus on your company’s internal processes.
If you are unsure about the type of audit your business will face, ask your auditor. They will be able to tell you what type of audit it is and what they will be looking for.
Gather your documents
Once you know what type of audit your business will face, you can start gathering the relevant documents. For a financial audit, this will include your balance sheet, income statement and cash flow statement. For a compliance audit, you should include your policies and procedures. For an operational audit, you should gather documentation that outlines your processes.
Don’t forget to include supporting documentation, such as bank statements and invoices. This documentation will help to support the information in your financial statements.
Prepare your team
Your audit team should be prepared to answer any questions that the auditor may have. They should also be prepared to provide supporting documentation if requested.
It is a good idea to have a meeting with your audit team before the audit starts. This will allow you to go over the process and answer any questions that they may have. By understanding the type of audit your business will face, gathering the relevant documents and preparing your team, you can help make sure that your audit goes smoothly.