Every financial audit, no matter how big or small, is full of stress, worry and anxiety – and with good reason. Oftentimes, accounting offices lack the resources needed to be fully prepared.
The best-case scenario? All you lose is time. With manual data entry and data flowing in from multiple sources, your numbers have a high risk of error. This can lead to lost time (and salaries) finding answers to financial-reporting discrepancies.
The worst-case scenario? The audit process is brought to a standstill due to errors, discrepancies and miscommunications associated with working remotely. This creates tension between management, the accounting team, the auditors, and external stakeholders while potential fines and sanctions are determined.
In order to avoid either scenario, as well as anything in between, you need to improve internal controls and mitigate remote audit risks. By adopting best practices while introducing automated accounting technology to your financial close processes you can resolve most of your month-end close discrepancies and make your financial reporting audit-ready.
Best Practices to Prepare for Remote Audits
Audits don’t have to be the process that everyone fears. When leveraged correctly, they can have immense benefits to your organization. Here are a few of the benefit audits provide:
- Ensure compliance with regulations and policies
- Identify operational inefficiencies
- Determine proper internal controls
- Identify cost savings
- Review IT systems and technology
These benefits are all critical to your accounting team’s success, especially in today’s remote work environment.
To help you achieve them, there are a few best practices you can follow to get the most out of a remote audit:
- Embrace constructive criticism. Audits are not designed to punish. They’re designed to help your accounting practices be more effective. So take the opportunity to learn from the feedback.
- Enhance your processes. Audits tend to expose gaps and shortcomings in your workflow. Use this knowledge to enhance your processes by making them centralized, consolidated, and coherent. This will lead to more accurate financial reporting.
- Simplify the handoff of information. Today’s remote audit environment means you need a better way to provide the necessary data to the auditor. Make sure they have ease of access through the cloud so they can view all pertinent information from their home or office.
Want to dive deeper into these best practices?
Check out our on-demand webinar: Utilizing Technology to Improve Controls and Mitigate Audit Risk
Read our blog: Best Practices for the Annual Audit in a Virtual World.
Adapting to Remote Audits
Even though remote audits are still a relatively new concept, rest assured they’re not going away any time soon. You need to be prepared for them, no matter what your industry is. Some of the more common risks and challenges you face include:
- Being unprepared
- Lack of visibility
- No task ownership
To counter these challenges, you need to take steps to ensure you have everything you need for your remote audit.
Reduce your risks. Full visibility helps you identify the tasks that might cause you the biggest headaches, whether it’s a reconciliation, an ERP report or a journal entry.
Empower your team. A process that encourages and enables your people to identify and take ownership of their own responsibilities makes for a stronger close.
Implement accounting automation. No accountant began their career with the hope that they’d spend the rest of their years working antiquated processes in a spreadsheet. Let them work on tasks that truly challenge them by automating tedious and mundane tasks.
By taking these steps, you’ll better prepare your organization for the next remote audits. To see how Adra by Trintech can help you find success during a remote audit, click here.
The Benefits of Accounting Automation When Preparing for an Audit
In addition to reducing errors from manual data entry and speeding up your financial close processes, automating your financial close can improve your controls and mitigate risks.
Do more with less. The exponential rise of eCommerce in the past two years has led to a massive increase in third-party vendors, which means you have a lot more transactions to reconcile without increasing your headcount. Automation helps you improve the quality and reliability of your data without being forced to add labor.
Consolidate your data. Collecting financial data through traditional means can be extremely time-consuming and difficult. Automation allows you to develop standardized workflows that make collecting data fast, efficient and intuitive.
Increase visibility into your processes. Manual processes usually include clipboards and checklists that can lead to small, but significant tasks being overlooked. With automation, you can create processes that require official sign-offs, ensuring more transparency into your close processes and more accurate financial reporting.
Enforce compliance requirements. As finance laws get more complicated, the need for internal policies that ensure accurate data becomes more critical to your reporting. Mitigate risks with automated accounting software that creates process rules, audit trails and task ownership.
For more insight on how automation can help your accounting practices in a remote environment, check out our webinar, Utilizing Technology to Improve Controls and Mitigate Audit Risk. Hear from industry experts Cheryl Levesque (DHG), Robert Michelwicz (Trintech) and Syril Mathai (Trintech) as they tackle tough questions about audit risks during a pandemic.
Stronger Internal Controls to Help Get You Through a Remote Audit
When Torchy’s Tacos announced they were going to open 20 new stores each year for the next five years, the accounting team knew they were in for a challenge. They were already having difficulty keeping up with their highly manual reconciliation process and the planned growth threatened to overwhelm them.
To help them adapt to their quick growth and be prepared for future audits, they partnered with Adra by Trintech to help automate their transaction matching. More importantly, they asked for a solution to help them create better controls for their audit.
The Adra Suite of accounting software helped them gain control over their financial close processes by accomplishing the following:
- Increase visibility
- Improve accuracy of reconciliations
- Reduce manual functions
- Cut costs and save time
Click here to read our case study on Torchy’s Tacos and how Adra provided a solution that offered solutions to their financial close challenges while providing a great ROI.
How Adra Helps You Get Your Remote Audit Right
In order to have a successful audit, whether it’s traditional or remote, you need to have the workflows and processes in place that set you up for success. By utilizing the automated accounting software found in the Adra Suite, you’re better prepared for any audit because your most complex challenges are solved quicker and more efficiently.
Now that you’re learned more about remote audits and how automated accounting software can help you be better prepared, be sure to watch our on-demand webinar, Utilizing Technology to Improve Controls and Mitigate Audit Risk.