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3 Keys to a Successful Remote Audit

3 Keys to a Successful Remote Audit

Can your audit be performed remotely? The short answer is Yes, with a disclaimer: It depends on your organization.

While remote auditing was beginning to emerge, it took a giant leap during the COVID-19 shutdown. We expect the remote audit process will continue to evolve and become more common in the future. Auditors are still required to meet auditing standards remotely, just as they would if the audit was handled onsite.

To Complete a Successful Remote Audit, Planning is Required

1. Preparation is Imperative

Your auditor will need electronic access to documentation, statements, and invoices. If you are already using cloud-based software, you can simply give read-only access to your auditor. If not, then you will need to work with the auditor on a secure way to provide the documentation required.

2. Communication is Key

Your auditor will establish routine virtual meetings, allowing your team to stay connected during the audit process. The ability to interact quickly and efficiently will minimize disruptions in your workplace and keep your audit moving along smoothly. With less travel time needed for remote audits, the team has more time available to communicate, creating more efficient audits that are often completed in expedited timeframes.

3. Cybersecurity Protocols Need to Be In Place

To prevent the corruption or loss of information that is required for the audit process, review your cybersecurity processes.

There are a Few Drawbacks to Remote Audits. Let's Cover a Couple of Those:

Physical Inventory Counting Requirements Will Make a Difference

If your audit requires physical asset observations, remote auditing will be more challenging, but it's still an option. Live video cameras can be used for the auditor to observe cycle counts. Additionally, a hybrid audit model could be developed with limited onsite auditor activities. When companies have year-ends that require a physical observation, analysis will be needed to make sure that remote audits can satisfy the requirements.

Assessing Fraud Risk Virtually is Challenging

Internal controls testing assesses the processes you have in place for both in-person and remote workers, including understanding the dynamics between co-workers. It may be harder for an auditor to assess fraud risks remotely. If you have recently modified work processes, you will want to make sure to shore up your documentation and processes before the audit.

Work with your auditor to determine the best way to create an efficient process for your audit. Have an open dialogue about the challenges and benefits of a remote audit to ensure your results are presented timely and transparently.

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Biz Tip Topic Expert: Lynn Heslinga, CPA

Lynn Heslinga, CPA

Lynn is a Principal with SVA Certified Public Accountants with focused expertise in nonprofit and real estate industries. In her role, she oversees and performs audits for owners of affordable multifamily housing units receiving Section 42 Low-Income Housing Tax Credits. Lynn also provides traditional audit, accounting, and tax services for nonprofits as well as advising nonprofit organizations on board governance, public charity status and public support test, internal control matters, and unrelated business income.

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