What Are The Various Ways To Ensure That Your Annual Audit Goes Smoothly?
Auditing may be considered as an intimidating process by the business owners as it is one of the key fundamental processes which must be conducted by the firm from time to time with high accuracy in order to attest that the firm performs the business in accordance with the principles, laws, and regulations and includes the inspection of all the records, statements and documents which may signify the working of the firm and its all activities.
The important factor which should be kept in mind before getting ready for an audit is that the firm must always keep the records of all the transactions from the beginning itself and it must be up to date, through this the auditors can be provided with an accurate statement which will be more convincible. A streamlined audit process will ease the pressure on auditors and they may be able to provide the audit report within a short duration. The smoothness of the audit process will directly impact the audit report, a crucial document used for various purposes such as communicating it to the investors, shareholders, licensing authorities, etc.
Some ways through which a firm can ensure that the audit process goes on smoothly include the following;
1. Assist the auditor:
The auditor and the company share the weight and responsibility of an audit equally. Both the entities face a lot of pressure during the audit. The auditors may face the burden of completing the process within the specified time and budget without any delay as they may have to engage with many other similar firms and conduct the audits. Similarly, the firm may also want to complete the audit within a short duration. So, it is always the best course to assist the auditors while they perform the audit and corporate with them by providing them with all the required documents and facilities.
2.Provide accurate PBCs:
During an audit process, the auditor may provide the firm with a timeline and a list of items and documents required by them in order to conduct the audit smoothly. These items may be generally called PBC (Provided by the Client) in business audit jargon. It is the duty and responsibility of the firm to provide such documents and items on time. The firm must also ensure that these records and documents are error-free and accurate. The Auditors must not be put in a position where they may have to find the records themselves out of a box, which may result in wastage of time and effort.
3.Cooperate with auditor:
Sometimes the auditor may find some discrepancies or errors during the inspection. It may be due to the incomplete documents provided by the firm or due to the absence of required reports and documents. In such situations, the firm must have the empathy to understand what the auditors are in need of and provide such documents. If the firm cannot provide such documents or if it is impractical to gather such data, it must be communicated to the auditor without any hesitation. The firm must be transparent during the audit process, and the firm must disclose every aspect to the auditor so that the auditors can assess the prevailing situation and apply alternatives to evaluate the data and documents.
4.Ask for assistance from the auditors:
Calling the auditors and asking for their assistance in advance during the year regarding the treatments of different transactions will help the firm to maintain an accurate report and statements of all the transactions made. It may help the firm to ensure whether the transactions made are in compliance with the principles and laws beforehand, which in turn will benefit the firm during the annual audit.
5.Try to perform reconciliations frequently:
It is always the best course to perform the reconciliations of the documents monthly or quarterly which may allow the firm to identify, investigate and resolve the reconciling items in a regular manner, otherwise the firm may not have enough time to resolve the issues before the audit during the end of the year.
Other solutions to make the audit smoother include the following:
- Scheduling meetings with the internal accounting team and the auditing firms to discuss the timelines and the expectations.
- To maintain continuous contact with the auditing firm to discuss various treatments of different transactions and other significant events during the year.
- Getting the list of information from the accountants that will be required of the staff.
- Ensuring whether the information regarding VAT return filing and Economic substance filing is ready if it is applicable.
- Once the audit starts to relax, it is to be conducted regularly once a year and it is inevitable, hence the firms must not consider it as any nightmare instead it is the evaluation of the performance of the firm.
How can CDA help?
The above-stated points are the general guidelines that can be followed by the firms before any auditing firm visits them, to make the audit smoother. CDA is one of the leading auditing firms in Dubai which provides personalized and professionalized services to its clients.
It performs its services in a transparent manner by which the clients can approach the auditors if they have any queries regarding the auditing processes. The clients can communicate CDA whenever they are in need of any assistance and advice regarding the accounting treatments of various different transactions.
CDA with its team of experts is always ready to help its client regarding any issues related to accounting, auditing, VAT-return filing, etc. By providing customer-tailored services always focuses on solving the issues of the clients in the most effective manner.