Streamlining External Financial Statement Audits
External audits can be stressful and disruptive if finance teams are unprepared. By establishing robust audit preparation workflows, mid-market companies can reduce audit fees, eliminate field work delays, and prevent unexpected audit adjustments.
5-Step Audit Readiness Checklist
- Pre-Audit Planning Meeting: Align with your external CPA audit team 60 days prior to year-end to confirm audit scope, timelines, and technical accounting updates.
- Reconcile All Balance Sheet Accounts: Ensure sub-ledgers (accounts receivable, accounts payable, fixed assets, inventory) tie exactly to the general ledger trial balance.
- Assemble Technical Memorandums: Prepare written position papers for non-standard transactions, debt covenants, revenue recognition policies, or litigation contingencies.
- Prepare Audit Confirmation Letters: Generate legal, bank, and major customer/vendor confirmation requests early in the audit cycle.
- Establish Single Point of Contact: Designate a senior finance manager to coordinate all auditor requests and prevent duplicate communications.