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Audit

Audit efficiency: How to avoid common traps

Thomson Reuters Tax & Accounting  

Julie Wiese  Senior Trainer, Tax & Accounting Professional Services, Thomson Reuters

· 5 minute read

Thomson Reuters Tax & Accounting  

Julie Wiese  Senior Trainer, Tax & Accounting Professional Services, Thomson Reuters

· 5 minute read

An audit team’s ability to conduct efficient, effective audits can be a major differentiation factor that sets them apart from the competition. But with all the complexities of modern-day audits, it can be difficult to ensure that you are making the most of your time and resources.  

That’s why it’s important to recognize common audit traps — it not only helps your team tackle these new challenges, but it also sets them up for success. Additionally, by understanding and avoiding common pitfalls, you can help your team identify areas of improvement while staying organized and productive.  

With that in mind, here are a few common audit traps to avoid: 

The Checklist Trap 

One of the most common traps audit teams fall into is relying too heavily on checklists. While checklists are an invaluable tool during the audit process, they should not be used as a catch-all solution.  

Checklists often contain information that may not be relevant to your client’s particular situation or industry, and they may be missing elements that could be crucial for a successful audit. As such, it’s important to tailor your checklist to fit each client’s specific needs and requirements rather than relying solely on generic templates or outdated versions. 

The solution

The best solution to the checklist trap is to use the checklist as a guideline rather than an absolute authority. Checklists can be great for getting started and understanding general best practices but should not be followed blindly; it’s important to tailor each audit process to fit individual client needs and requirements. Every audit situation is unique, so checklists should not be used as a one-size-fits-all solution.  

The Information Overkill Trap 

Another mistake audit teams often make is providing too much information — or what we like to call “information overkill.”  

It’s important to remember that evidence does not always equal documentation. Evidence is what the auditor looks at; documentation is what we leave behind. Collecting more documentation than necessary can lead to unnecessary delays in the review process and create confusion among auditors.  

The solution

To ensure efficient audits, focus on providing only the necessary documents. Try creating a system of clear objectives and expectations that each member of the audit team can follow when gathering evidence. This will help ensure that only the necessary documents are collected, which will save time in the review process.  

The Review Notes Trap  

The “Review Notes” Trap is a common mistake audit teams make when conducting reviews. Review notes are an important part of the audit process, as they provide guidance and instruction on what to focus on during the review. However, if review notes are too generic or outdated, they can lead to inefficient audits and inaccurate findings. 

Additionally, organizations may collect and review more data than they need to — creating an excessive amount of review notes in the process. This extra data may come from areas that are not relevant to the overall audit, or it may become duplicative of data that was collected previously. 

The solution 

To avoid this trap, try to use more specific and up-to-date review notes that clearly outline what needs to be reviewed. If necessary, provide guidance on how to interpret certain findings or documents. Audit teams should also focus on training and supervising staff to ensure they are collecting the right data for the job. This will help save time during the review process and streamline efficiency.  

The “Same as Last Year” Trap 

Auditing teams often face the challenge of avoiding the “Same as Last Year” trap, which refers to the tendency to continue doing the same audit tasks and objectives year after year without taking advantage of new technologies or approaches that could help streamline their processes. This trap can be particularly detrimental for organizations who want to remain competitive in an ever-changing and increasingly digital environment. 

The solution

After each audit cycle, take some time to reflect on what went well (and what didn’t) so you can learn how best to approach future engagements even more efficiently than before. Make it a habit to regularly review your processes and look for new ways of doing things. Consider investing in new technologies, such as AI-driven tools or cloud-native platforms, that can help automate some of the manual processes. Some benefits might include: 

  • Automated document retention policies 
  • The ability to instantly access audit data from any place 
  • Streamlined processes that eliminate the need to transfer, back up, restore, or refresh files 
  • One unified application that allows you to easily initiate and track your documents while receiving real-time confirmations.

Optimizing for audit efficiency 

Ultimately, audit teams must remain vigilant to ensure they do not fall into common traps that impede on their workflow. With the increasing complexity of modern-day audits, it’s key to regularly assess your methods and search for ways to improve. 

How can your team enhance their performance and excel? 

To learn about mastering audits in the digital age, be sure to watch our webcast Remote audit best practices and discover how your firm can audit from anywhere.   

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