We go through the annual audit process and it can at times seem routine but, in truth, how routine is anything nowadays in the finance department, business office or just in general? The real truth is that it is an opportunity worth seizing. This is the chance to ask your auditor questions in an ever changing environment. I have pulled together a list of five questions we auditors wish our clients would ask us.
#1 – How is my team performing and what could we do better?
Auditors have a unique insight as we get to see several other organizations that are similar to yours. We have seen a lot of things that work well and certainly others that don’t work as they should. Many times some of these will find their way into our management letter, but most processes are adequate so nothing gets communicated. So if you ask this question you might find some very specific information about your staff, as well as possibly a solution as to how to address your unique situations.
#2 – Can we get together throughout the year so we can talk about how our year is going?
We spend a lot of time with you after year end, but many times we find that something new or unique has happened that we weren’t aware of. Finding out this information after year end really ties our hands as to what kind of help we can provide. We also tend to find that our prior findings or comments were not addressed and become repeat findings, which typically leaves everyone unhappy. If we got together once or twice a year outside of the audit process, then we would have the chance to avoid some of these potential issues.
#3 – If you could change one thing about how we prepare for the audit, what would it be?
Just like you, we tend to go through the routine motions as we start the audit. We schedule our dates, send our assistance lists, and get ready to start the audit. Sometimes our clients are very honest with us and let us know that something we are doing is bothering them or what we are asking for is very difficult to obtain. Usually we don’t know that we are causing you a problem, but we wish you would just let us know. There might be something else we could use that doesn’t take as much of your time, or we could look for an alternate way to perform our testing.
#4 – Would you review our budget assumptions and help with long-range planning?
At the end of the audit, when we are doing our budget analysis and financial reporting, we occasionally find some large variances. Often it is related to some unusual transactions or some assumptions that were not used or considered when a budget amendment was completed. One of our strengths is data analysis, as well as financial projections. This is an area that we can provide some good advice and offer some useful information that our clients could use to plan for the current year and into the future.
#5 – Can you help us prepare for unexpected turnover?
This is a great question that always seems to come up when it is too late. The key phrase is “prepare for, not react to.” We do go through your internal controls in detail and have a very good understanding of how they work. What we would like to do more of is to help create a detailed listing of procedures or handbooks that address all the steps in the process. Also, we can offer suggestions for cross-training or downsizing while maintaining checks and balances in your internal control system.
I am sure we can all think of several more questions, but these are a few of the most important ones I wanted to share. Take advantage of the relationship you have with your auditor to come up with new thoughts or ideas. Remember, we are your auditors all year, not just at year end.