Audit Readiness & Preparation Services
Ever gone through a financial statement audit or financial due diligence review? If you have, then we know your pain. If you haven’t…then get ready.
External audits and reviews of your financials can be tough. Even with the best audit/review team, you can expect a barrage of information requests for all areas of your business, as well as hours of follow-up requests and calls to resolve questions and issues identified by these teams throughout the process.
We know those pains well; we were auditors ourselves. Let our team help you navigate the audit/review process, better understand the requests made, and reduce the amount of follow-up questions or requests, as well as unexpected audit or review adjustments (nobody wants those). Learn more about our services below, or check out our Zeroed-Insights for past articles on accounting matters.
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At the beginning of an engagement, auditors and reviewers identify the areas where they plan to focus their time and efforts. This generally relates to areas with higher risk, such as revenue recognition, or complex areas of a business, such as recent acquisitions or software development costs. Lower risk areas will likely see less scrutiny and fewer requests.
With our prior audit experience, our team can efficiently and effectively identify the areas of your business where auditors/reviewers will likely focus their time. By being proactive, you can focus your time and efforts on the area that will matter most.
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The information request list from an audit or review team can be overwhelming. It often features dozens, if not hundreds, of requests for information related to all areas of your business.
Through our past experience and knowledge of related requests, our team can help you prioritize the requests that will be most impactful for an audit team, allowing them to make progress in their procedures and avoid unnecessary/costly delays. We can also help you better understand the purpose or key components of their request, reducing back-and-forth with the audit/review team.
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If you are undergoing an audit, chances are that they are expecting your financial information to be prepared in accordance with the complex accounting framework of US GAAP. This accounting can be far more intensive, and with different impacts, than the accounting that you have generally performed up to this point.
With a complete understanding of US GAAP and the vast accounting guidance behind it, our team can help you update your accounting records to ensure that they are in accordance with US GAAP. In doing so, this will lead to fewer follow-up requests and discussions with the audit team, and fewer audit adjustments reported to management at the end of the project.
Ways that we can assist your team through an audit or diligence review:
Meet Your Accounting Experts
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Kyle Geers
CEO/Co-Founder
Kyle Geers is a CPA based in Los Angeles with 10+ years of experience in public accounting, specializing in financial statement audits and accounting advisory. He is a graduate of the Goldman Sachs 10,000 Small Businesses accelerator program and a UCLA alum with extensive expertise in US GAAP and SEC Reporting. -
Matt Moschetti
Director
Matt Moschetti is a Nevada-based CPA with 10+ years of accounting experience that includes audits, technical accounting advisory, and corporate accounting roles. He holds a Bachelor’s degree in Business Administration with majors in Accounting and Information Systems from the University of Nevada, Reno.
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Danielle Lewis
Director
Danielle Lewis is a Nevada-based CPA with 10+ years of experience, specializing in US GAAP and regulatory standards like ASC 980. She holds advanced degrees in accounting and economics from the University of Nevada, Reno.
Frequently Asked Questions (FAQ)
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Undergoing a financial statement audit can be a daunting task. It involves numerous information requests by the external audit team and an in-depth knowledge of both your company’s operations and the required accounting guidance framework, such as US GAAP or IFRS.
The following steps can set you up for success as you prepare for an upcoming audit:
Step 1: Confirm the Audit Scope. Find out the fiscal periods under audit, reporting deadlines, and the level of audit/review required.
Step 2: Identify the Audit Lead. Select who within your company will be the main contact with the auditors throughout the engagement. This should be someone with a strong understanding of the company, of accounting principles, and access to company information.
Step 3: Select an Audit Firm. Interview with multiple firms and see which is best in terms of reputation and cost.
Step 4: Obtain an audit request list. This will help you understand the types of reports and other files that the auditor will request.
Step 5: Perform an internal assessment. Considering the higher risk areas of your business, such as Revenues or significant/complex transactions, will help you focus your efforts.
Step 6: Develop an audit timeline. Work with your auditors to determine key deadlines for requests and areas, priority of their various requests, and a cadence for periodic updates on progress and any open items or roadblocks.
Step 7: Prepare necessary requests. Work with team members to prepare as much of the requested information as possible prior to audit kickoff. This includes preparing schedules, identifying where supporting records are located, and drafting memos or write-ups of the accounting for complex or high-risk accounting areas.
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Significant preparation for a financial statement audit, before it begins, helps you and your team work through the long list of information and schedules requested by the auditors early on.
Having clean and accurate information ready by the beginning of an audit can lead to fewer questions by the audit team, reduce the amount of time spent by both parties on rework and follow-up requests, reduce potential audit overrun fees, and minimize the number of audit adjustments reported to management and the Board upon the conclusion of the audit.
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Audit planning and preparation means developing an overall strategy and action plan for a company’s upcoming audit, such as a financial statement audit.
It helps identify key deadlines, high-risk audit areas, and the information required to successfully complete the audit, as well as the individuals assigned to each area of the audit.
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At the end of an audit, the auditor (whether a firm or individual) will prepare an audit report. This report states the auditor’s opinion on whether the audited financial statements are materially correct (“unqualified”) or requiring adjustment (“qualified”), as well as the regulatory standards under which the audit was performed (e.g., “AICPA” vs. “PCAOB” for US companies).
Understand the purpose behind interim testing performed by auditors, and how you can use it to avoid costly audit overruns at year-end.