Keys to a Successful Audit
People often think of an audit as a few stressful weeks preparing for auditors to arrive, new requests coming in and everyone scrambling to find the information they need. In reality, a successful audit begins long before the first day of fieldwork.
The most effective audits are the result of the months of preparation, organization and coordination. When records are maintained throughout the year, policies remain current and departments communicate effectively, the process becomes more manageable for everyone involved. More importantly, these practices help protect the organization and its members.
There are a few key factors that go into creating a smooth, successful audit process.
Keep Records Organized Year-Round
One of the simplest ways to make an audit easier is to avoid treating documentation as an annual project. Maintaining organized records throughout the year makes it easier to locate documents when auditors request them. Consistent file naming, organized email correspondence and clear documentation can save significant time when information needs to be retrieved quickly.
Rather than creating documentation specifically for an audit, organizations should rely on the processes and records they already use to conduct business. A centralized and intuitive approach to document storage can also help ensure the right information is accessible when it is needed.
Coordinate Responses Across Departments
An audit is rarely the responsibility of one department. While it helps to have a primary point of contact coordinating the process, successful audits require collaboration across the organization. Coordination involves more than sending an email requesting information. Someone needs to understand what the auditor is asking for, determine who needs to be involved, follow up on outstanding requests and keep projects moving.
Sometimes, an auditor’s request may require clarification or translation into terms that different departments can understand more easily. Asking questions early can prevent unnecessary back-and-forth and help ensure the right information is provided the first time. Establishing clear ownership for requests can also reduce confusion. When employees understand their responsibilities and deadlines, they can better balance audit-related work with their everyday priorities.
Keep Policies and Procedures Current
An audit can quickly expose policies or documentation that are outdated or no longer reflect how an organization operates. Regularly reviewing policies and procedures helps ensure employees are following appropriate processes and that documentation accurately reflects current practices. This includes documenting important decisions, obtaining appropriate approvals and staying informed about regulatory changes that could affect the organization.
Rather than waiting for an audit to identify a gap, organizations can use regular policy reviews to address potential weaknesses before they become larger issues.
Communicate With the Right Stakeholders
Communication can make a significant difference in the audit experience. Everyone involved has competing priorities, and a delayed response from one person or department can affect several others. Establish expectations for timelines, responsibilities and availability before the audit begins. Identify the individuals who will need to provide documentation, answer questions or participate in meetings, and make sure they understand their role.
Communication with the audit team is equally important. When questions arise, ask for clarification rather than making assumptions. Providing incomplete or incorrect information simply to meet a deadline can lead to additional requests and unnecessary work. A clear and collaborative relationship with auditors can help keep the process moving and make it easier to address issues as they arise.
Prepare Before the Audit Begins
Audit preparation shouldn’t start when the first request list arrives. Organizations can use the time between audits to review processes, identify gaps, update documentation and make improvements. Creating a repeatable preparation process with checklists, clearly assigned responsibilities and organized documentation can make each audit more efficient than the last. By doing so, you can reduce last-minute work and help employees understand what is expected. Regularly evaluating audit readiness can also provide an opportunity to identify weaknesses in controls, policies or processes before fieldwork begins.
Use the Audit as an Opportunity to Improve
An audit may be a requirement, but it can also provide valuable insight into an organization’s processes and risk management. Rather than viewing audit findings simply as problems to correct, organizations can use them to identify opportunities for improvement. Findings can highlight areas where processes could be strengthened, documentation could be clearer or controls could be more effective.
Approaching an audit with a mindset of continuous improvement can turn the experience into more than a compliance exercise. It can help organizations strengthen their operations and better prepare for future challenges.
A successful audit isn’t something that happens in a few stressful weeks. It is the result of the work an organization does throughout the year.
Valerie Stewart, administrative coordinator for Vizo Financial, provides support for various compliance functions including managing the audit program, acting as the liaison to NCUA and NCCUD examiners, legal coordination, policy governance and DocuSign administration.