Top 10 ways to cut your audit bill

// February 16th, 2009 // Business

I was reading up on the audit profession and I came across a CFO article on “Top 10x ways to cut your audit bill“. Article has some good practical advice on managing the auditors.

More after the break:

  1. Improve the internal audit function. One of the determinants of external audit costs is the reliability, scope and effectiveness of the internal auditors. Some businesses even go as far as co-sourcing this activity by beefing up their numbers with external expert advisors.
  2. Set expectations up front. Have an open and frank discussion with the auditors, so there’s no nasty surprises later.
  3. Kill some trees ahead of time. This works great, and is not dissimilar to the legal strategy to “bury the opponents in paperwork.” Just be careful you’re not providing enough rope to hang yourself with!
  4. Keep your auditor on speed dial. Refer to (2) above :-)
  5. Consider creative ways to split up the work. Refer to (1) above :-)
  6. Avoid change. Not all businesses can afford not rotating their auditors, but for those SME’s that fit the bill, avoiding chopping and changing over allows for “learning effects” and long run efficiencies.
  7. Baseline your controls. Maybe businesses should consider getting their co-sourced internal auditors to perform this function.
  8. Rationalise legal entities. Get rid of those dormant shell companies.
  9. Do a hard monthly close. Quarter ends then become “just another” month’s of transactions.
  10. Cancel those expensive lunches, have the tea lady toast some sandwiches for the team.

Of these 10x the ones that are “low hanging fruit” and “easy-wins” for most of us is probably (9), (10) and my personal favourite, (3). Good luck with your external audits!

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