Are you wondering how to prepare for an internal audit or an external audit? Brown Auditing Services can help by advising you of our top audit tips for employees and employers in New South Wales. We’ve put together this detailed guide to help you with your preparation before an audit. Learn more about external and internal audit best practices and prepare to successfully navigate audit season.

Understanding the Audit Process

Learning how to prepare for an external audit or an internal one starts with understanding the process. The more you know, the easier it will be to manage the audit process efficiently. Internal audits begin with auditors being appointed within the organisation to conduct an objective review of the company’s financial statements and transactions. Their goal is to confirm that the organisation’s finances are accurate. Once the audit is complete, a report will be generated to share with directors and managers. An audit report is advantageous to organisations as it identifies areas for improvement, specifically related to internal controls and compliance regulations.

The external audit process is slightly different, as external auditors have a higher level of independence from the organisation being audited. Third-party auditors adhere to their own standards, rather than internal auditors who use the standards requested by the organisation that hired them. External audits remove potential bias and support rigorous checks, with the final report offering additional assurance that the audit conclusions are fully impartial.

It’s important to keep in mind these differences between appointing an internal auditor or arranging external audit and assurance services.

Preparing for Audit Success

Organisations that can confidently prepare for an upcoming audit can support a successful outcome. Planning ahead is important, as the finance department needs to prepare documents and make sure all accounts are reconciled. This includes paying outstanding invoices and employee expenses, which allows for accurate projections and audit analysis. If there are contractual amendments or other admin issues, they should be addressed before the audit so it’s as clear as possible to the chosen auditor.

Other audit tips for employees include brushing up on accounting standards and identifying significant changes such as increased revenue or investments. Preparation before an audit takes a team effort, and the entire management staff and finance department should work together to divvy up responsibilities and establish a timeline. It often helps to choose an audit champion who leads the preparation, assigns tasks to the rest of the team and checks in on progress.

Final Thoughts: How to Prepare for an External Audit

To maintain compliance and protect your organisation, it helps to book in a highly reputable external auditor and prepare early. Make sure to prepare the general ledger, financial year budgets, transactions, financial statements, accounting policies and anything else required by the auditor. Self-audit practices with the latest technology can also help you keep up with industry recommendations and be in a better position when audit season rolls around.

Explore Internal Audit Best Practices with Brown Auditing Services

Now that you know how to prepare for an internal audit, you can look forward to a successful, streamlined audit to prove financial compliance. Contact Brown Auditing Services in New South Wales for comprehensive audit solutions.