Analyze Before being Audited
Lately I’ve noticed a new trend in data analytics where clients are asking for analytics to be performed on their data prior to or during an audit. The principle behind this is to “know the unknown” before the auditing party whether it be CRA, external auditors or external vendors discovers the “unknown”. This has proven to be a great method for reducing risk and being proactive in responding to and reducing audit findings.
Often in today’s busy business environment, we do not take the time to analyze our valuable data which is being produced and stored. It’s not until someone comes calling that we then decided to take a look at the data or in most cases blindly hope all is well. With all the talk lately of big data and data analytics we tend to pass this off as a “nice to have” project or “I’ll get to it later”. We often forget that we, the business, is not the only stakeholders that uses and relies on our data.
The idea of analyzing your data before an audit has several benefits:
Cost savings – depending on the type of audit that is being performed, interest and penalties may be applied to any finding. These costs can be reduced if issues are detected early. There are also opportunities to find any missed revenue such as unpaid customer invoices or missed tax credits.
Time savings – analyzing the data prior to sending it will ensure that population is complete and accurate preventing wasted time to re-extract data or search for more information as the audit is progressing. As well, it ensures you have all the information at your fingertips should there be any additional requests.
Risk reduction – if there is an error which you can find and correct prior to the audit, the risks are minimized. Risk of penalties or noncompliance to contractual terms can be reduced.
Being proactive and analyzing data prior to an audit will help to make the audit go smother and could potentially lead to cost savings. This gives the business a chance to dive into their data which is a task that is often overlooked or put off.
In response to this current trend, we have developed specific analytics to address the completeness and accuracy of data for audits as well as analytics to look for cost savings and efficiencies within your business. As more parties will be relying on your business’s data, analytics will continue to become an important part of your business processes.
