5 Benefits of preparing for your government audit all year long
January 23, 2024
Your government audit takes place once a year. As such, it can be tempting to only think about it, well, once a year. But limiting your focus on your organization’s audit to the weeks leading up to it can make the audit process more stressful than necessary. It also can keep you from experiencing the benefits of being truly prepared.
Here are some of the ways in which preparing for your government audit throughout the year can benefit your organization—and your mental health.
Empower your board or council members to make more informed decisions.
One of the most compelling benefits of preparing for your government audit throughout the year is that it requires your organization to establish thorough internal controls and consistently review financial processes. These actions allow for accurate and transparent financial reporting to your organization’s board or council, giving members a real-time understanding of the organization’s financial health.
With this information, board or council members are empowered to make more informed decisions—at any point in the year.
Feel confident in your reports to your board or council.
On the flip side, if your organization’s balances are inaccurate until the audit, what your board or council sees earlier in the year may be totally different than what ends up in the audit report.
Being prepared as I mentioned gives board or council members greater trust in the numbers they’re getting from the finance department. They can feel comfortable with the current year’s numbers if they know they’re starting out in the right spot. Most important, you’ll be able to confidently respond to any questions they ask.
Reduce your mental burden.
Until your government audit is delivered, your organization could be reporting on its balances from the current and previous year and preparing next year’s budget. This means you’re having to think about three years of financial activity all at once.
The sooner you can prepare for your organization’s audit, the quicker you’ll be able to turn around the current year’s financial statements, which will allow you to get one of these years off your plate. What’s more, with the audit preparation behind you, you can fully devote your attention to the next year’s budget.
Work more efficiently.
If you’re preparing for your government audit throughout the year, you’ll likely maintain an open line of communication with your external auditor.
This can be helpful for a few reasons: First, your external auditor can walk you through the implementation of any new accounting standards that come up, preventing you from feeling like you’re spinning your wheels. Second, your external auditor can advise on complicated entries as well as how to account for any new services offered by your local government.
Finally, and perhaps most important, if you’re prepared for your government audit—and your external auditor is in the loop—you won’t be fielding as many questions from your auditor during the audit process. This means fewer interruptions in your already busy schedule.
Get a better understanding of your organization’s financial health.
Having your government audit in mind throughout the year can help you proactively gather the audit support, feel confident in the numbers you present to your board or council, and stay focused on important tasks. This can all lead to less stress in your life, especially during the audit process, and give you a clearer picture of your organization’s overall financial health.
We understand getting organized can be a challenge in and of itself too. Our team is here to help you take the first step.
If you’d like to learn more about how we could brighten your government audit process, contact us today.