There are a lot of things you can do to prepare for an external audit, but why prepare for one if you don’t have to? Although there are some instances when an audit is required, it may not be required all that often, so wouldn’t it just be better to skip the hassle and headache and wait until you absolutely have to have one done?
There are plenty of important reasons to schedule an external audit, even if you aren’t required to have one yet.
Compliance is a huge deal, especially since it isn’t an easy concept to grasp. There are many areas of your business that need to be compliant including:
- Workplace health and safety
- Employee time off
- Environmental regulations
- Financial regulations
- And more
There are many compliance laws that must be followed. For example, SOX compliance requires your business to be transparent financial statements and ensure they are accurate. Only an audit can ensure you’re complying.
There are many ways to ensure your employees are being accountable. It might mean fostering a culture of collaboration or being willing to fess up when you make a mistake, but it also means conducting regular audits.
An audit can ensure managers are providing accurate reports and employees are performing up to company standards. In a large business, an audit may be the only way to uncover whether or not your employees are being as accountable as they should be in their specific areas.
Peace of Mind
Most businesses have investors, and those investors want to know that things are going well. Your employees want to know that they’ll continue to have a job too!
An external audit can provide cold hard facts that you can present to your investors. They can also be used to ease the minds of employees who may be worried about job security.
It can provide you with peace of mind too! When tax time rolls around, you know the paperwork you file will be accurate.
It’s All About the Money
At the end of the day, a company is in business to make money, which ultimately means, an audit is about uncovering financial details.
First, an audit can uncover where your money is going. It can help you determine if you can spend more to expand, or if you need to close your pocketbook and start saving.
Not only can an audit uncover your business’s spending habits, it can actually improve your credit rating.
An external audit is much more trustworthy than an internal audit, so creditors and investors are more likely to lend you money at lower interest rates.
Don’t let the idea of an external audit scare you. It can actually do a lot to help your business grow! Just think about all of the great reasons why you should conduct an external audit when the auditor knocks on your door. When you have the findings in your hand, you’ll be glad you did!