An audit provides a business with an opportunity to get a set of fresh, impartial and expert eyes on their affairs. An audit can take many forms, but the most common is a financial audit. You might conduct one internally, or your might bring in an experienced specialist outsider organisation to do it for you.
What are your responsibilities as the head of the business?
It’s the duty of the business to cooperate with the auditors, and to provide any relevant evidence. The auditor will want access to your accounts for the financial year being audited. They might also ask for records going further back – and you should be prepared to provide them.
The job of the auditor doesn’t extend to dealing with fraud and faulty records. If you present them with inaccurate or misleading data, then the fault will ultimately rest with you. As such, the main responsibility of the business owner comes before the audit itself. You’ll need to keep accurate financial records on an ongoing basis – and that typically means developing the right practices and procedures.
Be sure to set a goal of what you want to achieve in your audit
If you don’t have goals going into the audit, then you’re unlikely to get a substantial benefit from it. Your goals should obey the SMART acronym – that is, they should be specific, measurable, achievable, realistic, and timely.
Before you set your goals down, it’s often a good idea to hold an open-ended discussion between key decision makers. You can look back on the success or failure of previous audits and look at how you might alter your objectives accordingly.
You might move from interviews with management to experimentation with different parameters. Throughout the process, you should communicate your intentions with management, and present them with a detailed document – which can act as an introduction to the audit’s findings.
Communicate with your company that an audit will take place and why
For an audit to stand the best chance of success, you’ll need to communicate with your business. Everyone needs to know that the requests of auditors are to be treated as high priority. Plus, everyone needs to be forewarned that an audit will be placing demands on their time and attention, especially during traditionally busy times of the year.
Work with the auditor
You’ll need to co-operate with your auditor to demonstrate that you’re committed to the process. Follow up on their recommendations and implement them. Don’t just wave them away – otherwise, the whole process will just be a pointless box-ticking exercise.
