Build A Better Audit Today!
Many CPA firms want to move beyond the generic capabilities of off the shelf audit methodologies. As the market become more competitive and the need to drive efficiencies more acute, these solutions fall well short of delivering the value in two key areas:
- Despite being off the shelf, these solutions lack the capabilities to create a more efficient, consistent and streamlined audit process. If you don’t do it exactly the way the solution prescribes, you will likely create redundancies and inefficiencies in your process.
- There is little opportunity for the firm to differentiate their services. In a market that becomes more crowded and competitive every day, many firms seek ways to stand out. The off the shelf audit solutions cannot provide any help in this area.
Building a customized audit methodology takes commitment and some due diligence. When deciding what audit software to use, I suggest considering the following major components during your initial planning phase:
- Central repository for information: One of the unique characteristics of audits is the level of decentralization in the end-to-end process. The people are decentralized – they work at the client site. The tools are decentralized – most audits involve different software solutions, often running on different platforms. The process is decentralized – audit teams often call their own plays based on the specific client engagement.
Creating a central repository for information is the foundation for pulling together a cohesive audit process.
- Define your logic: A logic driven process with logic driven workflow is one of the keys to both the efficiency of your process and the consistency of your service delivery. For example:
Let’s say you have an audit program that consists of 25 steps. Let’s also stipulate that five of those steps are only relevant if this is a first year audit and there is a high risk around valuation. A good workflow should recognize which “route” the specific situation requires, and then automatically apply the logic to present only the pertinent steps and route to the proper levels of review.
Business logic is the most important, and most overlooked, component of workflow. It is the key to improving the productivity of your team and reducing compliance risk.
- Reporting to support management oversight: This is one of the major drawbacks of off the shelf audit solutions. They do not offer the visibility necessary for meaningful management oversight. We define meaningful as the ability to identify bottlenecks quickly, spot inefficiencies in the process easily, and identify areas of potential risk.
- Collaborative: Individuals and teams must be able to easily collaborate on individual engagements. The collaboration between the client side activities and home office must be seamless.
Once again, developing your proprietary audit methodology may sound like a big undertaking, however there is a solution out there that can help you build a better audit today. allowing your firm to realize its vision of becoming more efficient and more competitive!