The COVID 19 pandemic dramatically altered the day-to-day existence of most companies. Though businesses may have had remote-work contingency plans, few could have expected the necessity to implement these procedures almost overnight. And even as state governments enacted shutdowns requiring all non-essential workers to figure remotely, many businesses were working with their auditors to finalize year-end finances audits and other attest reporting.
As a result, audit processes also started to change overnight. Remote audits have proven successful and are introduction improved efficiency, but it's important for businesses to recollect that careful planning will still be a valuable part of the remote audit process.
What is a remote audit in simple words?
In simple words, remote audits are audits that are performed virtually instead of on-site with a client. Auditing remotely isn't a replacement concept; however, companies have to regulate to employees working fully remotely, auditors too needed to quickly adapt their audit procedures and communications to satisfy their obligations while working completely remotely.
In the past, budget audits, reviews, compilations, and other reporting involved a substantial amount of on-site client time, as auditors worked with clients on planning, organization, and testing. Luckily, over the last five years, many of those attest functions were already being shifted to remote environments. With some time beyond regulation spent on planning, remote audits were able to be performed and completed despite the COVID-19 shutdown. Likely, remote auditing will still evolve and become common within the future, both as a result of the pandemic and also because auditing remotely may be done very effectively and efficiently - especially when clients are able to plan ahead.
How clients can perform remote audits?
As COVID-19 continues to change the way businesses operate, many are still ironing out their control policies and tweaking their remote working procedures tired a shot to control efficiently. As a part of this process, there are several audit-related areas that companies should consider to organize for a future that involves remote auditing.
Establishing proper controls for every employee: this can be one of the foremost important ways of safeguarding a company's assets and data. The management assessment of a company's internal controls assists auditors in conducting a correct audit.
Providing invoices, statements, and other supporting documentation: Electronic access to the current information has become an enormous challenge for several companies because it provides auditors with the flexibility to audit remotely. Many companies now utilize cloud-based software for this purpose, which not only hosts the final ledger function but includes the electronic copies of supporting documentation.
Powerful cybersecurity : When employees work from home they need a robust technology to work. Strong cybersecurity plans can prevent the loss and corruption of data that are vitally important to a company's audit process.
How are firms performing remote audits?
The shift towards remote auditing was a natural transition that was occurring even before COVID-19, though it's been speed up significantly by the shutdown. Audit teams have virtual tools to efficiently and effectively perform audit functions without sacrificing face-to-face time with audit clients, like video conferencing software like most companies have already begun using.
The security of client information could be a top priority when it involves technology and remote work. Our firm encourages clients to utilize a secure client portal to share data during the audit process. As mentioned above, cloud-based software that grants "read-only" access to auditors can ensure an auditor's independence isn't compromised.
Advantages and limitations of "Remote Audit"
Historically, performing from a client's location was the most effective thanks to accomplishing an audit. However, the swift evolution of contemporary technology has not only provided the likelihood of auditing remotely but increased efficiency within the process for everybody involved. Working remotely allows audit teams to spend less time traveling to a client site and longer acting on completing the tasks. This time beyond regulation increases availability and communication between client and auditor. Successful audit teams have found that being cognizant of a client's flexible schedule while working remotely and being readily available to reply to client correspondence has improved communication throughout the audit process.
For those audit clients that need physical or inventory asset observation procedures, the transition to remote auditing can cause trouble, but it's possible. There are a lot of options for finalizing audits remotely such as with live video cameras to satisfy audit steps.
For companies with year-ends turning out that need a physical observation, the specific analysis will have to be performed to make sure that enough remote auditing can satisfy the audit procedures. Each situation is different and maybe individually analyzed, but the potential for remote auditing to avoid wasting time and increase efficiency is robust.
Final words about remote audit
The COVID-19 pandemic has presented many business challenges, and accommodating audits was no exception. However, the transition from on-site to remote audits was already well underway, and, speed up by the crisis, has proven to own many benefits for both auditors and clients. it's likely that remote audits are here to remain, whether or not they are fully or partially remote within the future, and corporations are wise steel onself for this