When external or internal auditors examine and evaluate a company’s financial statements to ensure that those records are up to date and error-free, it can send terror into the hearts of CFOs, controllers and accounting teams. A necessary part of running a successful enterprise, audits can be “self-conducted” on an annual basis to ensure accuracy of the books or orchestrated by third parties like the Internal Revenue Service.
Regardless of the source of the audit, the best defense is always going to be a good offense when it comes to these exploratory exercises. Rather than being intimidated by the thought of an audit, or just hoping it may never happen, smart companies are consistently remain in “audit prep” mode. This not only avoids unexpected surprises, but it also flips the conversation and turns the audit into a quality control mechanism for your organization.
Because audited financial statements are seen as more reliable and trustworthy, audits may also create enhanced credibility. They ensure that financial statements comply with accounting standards and regulations, help identify weaknesses in internal controls, and reduce the risk of non-compliance penalties and potential legal challenges.
“Regardless of the type (external, internal, tax, etc.), auditing is critical for any business looking to maintain transparency and accountability in their operations,” Zoe Talent Solutions explains. “By identifying potential issues before they become major problems, companies can save time and money while avoiding legal headaches down the line.”
Unlock Audit Confidence with NetSuite
Any company that’s still using spreadsheets, disparate point solutions and paper to manage their financials is setting themselves up for failure when the inevitable audit happens. NetSuite automates many financial processes, effectively reducing manual errors and inconsistencies that may raise red flags during audits.
The enterprise resource planning (ERP) platform also provides comprehensive audit trails by tracking all changes and transactions, complies with many different financial and data security regulations, and offers pre-built reports that are specifically designed to meet audit requirements.
As a NetSuite Partner, ScaleNorth has helped many different companies leverage the power of the ERP’s robust audit-prep functionalities. Here are five ways NetSuite can help streamline your next audit:
1) Role-based access control for bulletproof audits.
NetSuite has a role-based access control system that governs what users can (and, cannot) do in the system. Each role includes sets of permissions for viewing and editing data, and roles and their permissions determine the pages that users can see in the ERP interface and the tasks they can complete. NetSuite provides many standard roles with predefined permissions and also comes with templates that you can use to create your own customized roles that can be assigned to account users.
2) Utilize general ledger audit numbering.
This NetSuite feature automatically sequences all general ledger (GL) transactions in the ERP. Even transactions that have been voided get a GL number and cannot be edited at a later date. You can also set up specific rules for the GL numbering sequence. Because NetSuite transactions can’t be “lost” or deleted, auditors always know that they’re reviewing a complete sample.
3) Leverage robust inventory management tools.
NetSuite’s inventory management capabilities help growing organizations realize efficiencies. Like accounting software, a well-designed inventory management system will also aid in preparing your company for business audits. “Growing organizations are often tasked with managing inventory data across multiple systems, some for listing products and others for processing orders,” NetSuite points out. “With an inventory management system, your organization will be ready for audits with a firm grasp of inventory flow.” You’ll enjoy improved efficiencies, fewer errors, and better stock management to name a few.
4) Monitor specific transactions with audit trail saved searches.
For most financial transactions in NetSuite, an audit trail is established and can be tracked and searched. Most changes to roles, customizations released into the system, transactions created and other common changes can be tracked in the system. For example, saved search alerts can be created to identify items that fall “outside” of ordinary processing parameters.
5) Handle electronic audits with ease.
NetSuite supports audit file formats for SAF-T (all OECD countries), GDPdU (Germany), IAF for Singapore and many more. With NetSuite, you get an always-on audit trail, built-in analytics, access logs and workflow management. The ability to drill down — from summary reports to underlying transaction details — provides transparency and allows your company to demonstrate ongoing compliance with local statutory and regulatory requirements.
6) Integrate third-party compliance software.
On top of NetSuite’s native audit preparation capabilities, you can implement and integrate third-party technology to further bolster your audit readiness. From sales & use tax automation platforms like Avalara, to lease accounting automation solutions like Netgain, you have an arsenal of software available to make sure you’re compliant around the clock.
With NetSuite and ScaleNorth in your corner, you’ll be well positioned to pass your next audit with flying colors. As a centralized hub for all your vital business data, NetSuite puts transparent internal controls and accurate reporting right at your auditors’ fingertips every time.
To learn more about NetSuite’s financial capabilities and audit management, contact ScaleNorth today.