Corporate Compliance

Seven steps for surviving your next external audit

Compliance Monitor, January 10, 2007

Checking and rechecking other people's work is part of being an auditor. But checking your own work is just as important, especially if you have an external audit coming up. By performing these self-checks on a regular basis, you can smooth the process of having an external auditor review your work.

1. Review your internal audits. Having your peers check your work first can catch many errors, which leaves you with less of a worry when an outsider arrives.

2. Hire an external auditor. Although your own internal audits can make you feel more comfortable with your organization's daily practices, they aren't foolproof. Ironically, the best way to prepare for an external audit is to have another external auditor look at your work.

3. Contact the outside auditing firm. Before the outside audit begins, have the auditors clearly write out the terms of the audit so there isn't any confusion down the road.

4. Get organized. The two documents for which external auditors will most likely look are audit worksheets and summary reports.

5. Cooperate. Although you should be careful about what you allow the external auditor to review, the more cooperative you are, the smoother things can go.

6. Make a practice of double-checking. All the preparation in the world won't help the results of an external audit if your department doesn't follow proper protocols and pay close attention to details daily.

7. Correct any errors found. Any extensive external audit will contain errors. But what makes your department look good or bad is how it corrects them. There is a difference between preliminary and final determinations, and acting efficiently can make a final determination look much better.

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