“I just went through six months of FINRA audits and I can tell you it was painful. They basically put me out of business for six months.” said Jeffrey Gitterman, Founder and CEO of Gitterman & Associates Wealth Management.
Your next audit doesn’t have to be painful. Here are four steps to help you keep it short, sweet and hassle-free.
1. Be prepared for the audit ahead of time.
The day of the audit is not the time to start collecting the documents on the list. The longer it takes you to get the auditors what they need, the longer they will have to stay—incurring more hours on your organization’s budget.
This is definitely true at Xpyria Investment Advisors. According to Joseph Salpietro, President and CEO, “The auditors call you a week or two before they show up and ask for the specific information they want to see. Prior to implementing our document management system, everything else was swept to the sidelines until we found what they needed.”
A document management system can make compiling the required documents quick and easy. Since implementing Laserfiche, Kentucky Sanitation District #1 (SD1) has breezed through its financial audits. SD1 simply provides the auditors with a laptop and access to whichever records they need directly in Laserfiche.
2. Make it easy for auditors to find exactly what they’re looking for.
Will a busy auditor be more kindly disposed toward your organization if he has to dig around inside a 100-page file for the information he needs, or if he is able to find it instantly?
A document management system can make compiling the necessary documents quick and efficient. Workflows can compile the shortcuts to appropriate documents or pages in one folder for the auditor to access easily. Another option is to mark all requested documents with a tag. For example, the town of Palm Beach, FL, applies a special tag to all documents related to a particular revenue bond and then retrieves these documents for the auditors with a simple search of the Laserfiche repository.
3. Predict the auditor’s questions.
A number of auditors’ questions are related to the year-over-year changes within your organization. If you are aware of a significant change, have your explanation ready.
Florida League of Cities spoke with auditors as it implemented its Laserfiche enterprise content management system to find out exactly what kind of information the auditors usually look for. They stored this information in metadata fields that can be quickly retrieved with one Laserfiche search. This made future audits very quick and easy because the League could prepare answers to all of the auditor’s questions.
4. Give the auditors the space they need.
Make yourself as available as possible during the audit to answer any questions the auditors may have. It is also important to dedicate a reasonably sized room to the auditors to conduct their work. Of course, if your organization uses document management, your auditor may be out of your office in no time (or not have to come in at all).
For example, when the U.S. Army Corps of Engineers (USACE) audited the debris load tickets and billing invoices from a Katrina clean-up project, Ceres Environmental was able to set up the major portion of the audit remotely. Since all of the load tickets were stored in a specific Laserfiche repository, the auditors were able to access them remotely. “Both parties recognized this would be a great cost-saver, since multiple people could access records from multiple locations at the same time.”
Are you interested in how to select a document management system that will make audits a breeze? Download the free “Document Management Buyer’s Handbook.”