Ongoing readiness for an audit is a critical task for any organization. Ensuring that your organization is ready can help avoid potential pitfalls and demonstrate adherence to regulatory standards. Below are essential tips and best practices to help ensure that your organization is prepared for an audit, whether it is internal, external, or regulatory.
- Conduct Ongoing Internal Review/Risk Assessments
- Conduct an internal review of your organization’s processes to assess compliance with all applicable regulations. This step can help you identify any potential issues before an external audit.
- Review Updated Regulations
- Organizations should continuously monitor and review regulations, as they can frequently change.
- Stay updated on the latest regulatory changes and ensure that your organization’s policies, procedures, and electronic systems are updated accordingly to maintain compliance.
- Plan
- Organizations should develop an audit plan to help guide your internal audit activity throughout the year.
- Internal Review/Risk Assessments along with regulatory changes should be incorporated into the audit plan to ensure that the organization has addressed risks and/or changes appropriately.
- Organize Documentation
- Make sure there are clear and defined practices in place to organize all required documentation, i.e., policies and procedures, audit tools, findings, reports, etc.
- Ensuring that the organization’s documentation is maintained in a single repository allows your organization to readily access any documentation that an auditor may require during their review.
- Compile Audit Checklists and Conduct Regular Audits
- Develop checklists to ensure that all required regulatory requirements have been met and that all necessary documentation is properly maintained within the record.
- Create a corrective action plan for any concerns or findings and validate that corrective action plans have been implemented as written. Organizations will want to ensure that they have a successful closed loop process and that corrective measures are successfully fixing the issue and preventing reoccurrences.
- Regularly Review Audit Findings for Possible Trends
- Organizations should trend all audit findings, both internal and external, and make changes to their policies and procedures and processes as appropriate. Doing this will show that your organization is being proactive, attempting to mitigate risk and striving for quality.
- Train Employees
- Ensure that employees receive training on subjects as required by various regulations, i.e., Security, Compliance, Security, Privacy, Sexual Harassment, etc. Organizations should also ensure that employees are trained timely and at the required frequency. Verification and documentation of all trainings should be tracked and monitored for completion.
- Organizations should ensure that their employees are trained on the organization’s policies and procedures on a regular basis.
- Employees should be trained on their roles and responsibilities within the organization and the importance of their role, as doing so can help mitigate various risks.
- Communication
- Regular, ongoing, effective communication with leadership should be occurring within the organization. Leadership should be informed of any current and potential risks, internal and external audit findings, corrective action plans, regulatory changes, updates to policies and procedures, or process changes.
Bonus Tips:
- Organizations should have policies and procedures in place to govern audit activity both internally and externally. Employees should be familiar with these policies and should know whom to notify in the event that an external audit should occur.
By following these best practices, organizations can effectively prepare for various audits, ensuring that they are well-positioned to demonstrate adherence to regulatory requirements and maintain their commitment to service excellence.
If you need further guidance or have any questions on this topic, we are here to help. Please do not hesitate to reach out to discuss your specific situation.
This material has been prepared for general, informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.
