Preparing for an audit can put even a capable finance team under pressure. Audit support services give internal teams additional capacity to manage reconciliations, documentation, financial statement preparation, and auditor requests without allowing the audit to consume their day-to-day responsibilities.
Key Takeaways
- Audit support services can help finance teams manage auditor requests, reconciliations, workpapers, financial statement preparation, and audit coordination.
- Outside support may be especially valuable when an audit overlaps with a month end close, reporting, forecasting, or other critical finance responsibilities
- Audit support works on management’s side of the engagement; it does not replace the independent external auditor.
- The best audit support engagements improve documentation and processes that can make future audits more efficient.
What Do Audit Support Services Include?
Audit support services offer hands-on assistance with the work management must complete before and during an external audit.
Depending on the organization’s needs, that can include:
- Preparing or reviewing account reconciliations
- Creating lead schedules and rollforwards
- Organizing workpapers
- Managing the Prepared by Client (PBC) list
- Gathering audit evidence
- Performing financial statement tie-outs
- Helping document complex transactions
- Tracking proposed audit adjustments
An audit support provider can also act as an auditor liaison for routine requests, helping keep documentation organized and questions routed to the appropriate people.
When Does Your Finance Team Need Audit Support?
Your finance team may need audit support when audit preparation starts interfering with close, reporting, and other day-to-day finance responsibilities. Reconciliations may fall behind, PBC requests keep expanding, financial statements require more cleanup than expected, or prior audit issues remain unresolved. Instead of progressing through a defined process, the team spends more time reacting to the next request.
According to Maria M. Sanjurjo, CPA, partner at AD Advisors and Outsource Dimensions, “Companies often underestimate the cost of going into an audit before the books are ready. An experienced accountant can identify issues early, before they slow down the audit or make the process more costly.”
Often, the problem is capacity, not a lack of accounting experience. The people managing the audit are still responsible for keeping the rest of the finance function moving, and competing priorities can quickly turn audit preparation into a disruption.
Additional support can be especially valuable when that pressure is combined with complex transactions, unresolved issues from a prior audit, or a firm deadline for delivering audited financial statements. Bringing in help early gives the team time to address those issues before they begin delaying the audit.
How Outside Support Reduces Audit Pressure
Effective audit support creates a more controlled process between the finance team and the external auditor. Instead of responding to requests as they arrive, the team has a clear system for determining what is needed, who is responsible for it, and whether the supporting documentation is ready for the auditor.
That structure can reduce unnecessary back-and-forth during fieldwork and keep smaller issues from becoming delays. More importantly, it protects the time of CFOs and controllers so they can focus on the areas that actually require their judgment and oversight rather than tracking down documents requested by the auditors
The benefits can continue after the audit is complete. Processes developed during the engagement can become part of the company’s normal close and reporting routines, leaving the finance team better prepared for the next audit.
Bring in Audit Support Before the Audit Becomes a Fire Drill
Audit support works alongside your finance team, while management retains responsibility for the financial statements and key accounting decisions, and the external auditor remains independent.
When exactly should a company bring in audit support? Ideally, planning should begin 90 to 120 days before year-end, especially if the company needs to address prior audit findings, complex transactions, or gaps in its records.
As Sanjurjo further explains, “Good communication before the audit is critical. The earlier everyone is aligned on timing and expectations, the better positioned the company is for an efficient and successful audit.”
Outsource Dimensions provides customized audit support and financial statement preparation that fits into your existing finance function.
Preparing for an upcoming audit? Contact Outsource Dimensions to discuss how additional support can help your team stay audit-ready without disrupting day-to-day operations.