Independent external audits of GAAP financial statements are an inescapable reality for finance professionals. External audits are required by statute for public companies and are also becoming the norm among private companies experiencing growing demands for transparency from regulators, investors, and other stakeholders.
For financial professionals, independent external audits of GAAP financial statements are an inescapable reality. For public companies, it’s a statutory requirement under SEC regulations and for many fast-growing private companies, it’s a necessity to meet the demands of lenders, VCs, and other stakeholders. There is even a possibility that the IRS could require a financial statement audit as part of a broader tax audit.
Ultimately, every audit boils down to the risk of a material misstatement in the numbers. The responsibility falls to you and your finance team to ensure that your financials present the lowest possible risk of such errors, thereby earning a “clean” (unqualified) opinion from your independent auditor.
To achieve a smoother process in preparing audit-ready financials, you need well-documented transactions, balances that are calculated accurately, and financial statements and backup documentation that can be produced in a timely manner.
Cloud accounting software helps finance teams mitigate audit-related risks by streamlining and automating the organization of source materials; the documentation of accounting treatments; the calculation and reconciliation of figures; consolidation and close; and, ultimately, the preparation of financial statements.
- How to develop a better process for preparing audit-ready financials.
- The 6 key steps in audit preparation.
- How cloud technology improves financial reporting and audit readiness.
- Ways to ensure your company earns a "clean" opinion from your auditor.
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