10 Ways to Save Money and Streamline Your Annual Audit

For many of you, entering into the beginning months of a calendar year brings thoughts of the traumas associated with your annual CPA audit. The intrusion, the loss of productivity, the frayed nerves trying to attend to normal job tasks while fulfilling the requests of the auditors can be overwhelming. The annual purging of transaction documents- making room for new transactions after the audit continues on into the month further hampering worker productivity.

Case in Point
In order to meet federal and state requirements, an equipment manufacturer’s AP department saved seven years of paper-based tax information at their Chicago, Illinois based facility. The documents took up half dozen 5-drawer filing cabinets, and employees across multiple departments frequently accessed the files. Documents were frequently lost or misfiled. The labor costs to copy, fax and mail were excessive – employees spent ten hours every month filing and re-filing documents. At the end of each year, a temporary employee spent 50 hours preparing files for offsite storage, where documents were held for another two to three years and cost the company $1,580 annually. During annual audits, files were manually located, retrieved, photocopied and re-filed. When documents were archived at two remote offices, retrieval was more complicated, because a coordinated effort was required to access and share information.

The annual audit each January was a nightmare, with employees scurrying to locate and produce documents on demand for 3 individual auditors. The auditors were generally onsite for 8 – 10 business days creating interruptions and diversions from normal month-end closing of the books as well as the year-end closing.

Reduce the Interference, Cost and Downtimes Typically Associated with Audits
There is a solution to this annual nightmare – a solution that not only provides a very quick payback (generally in nine months or less) but can potentially reduce your audit bill as well. One small company in southern California saw their annual audit bill drop 25% from $24,000 to $18,000 due to the reduced number of onsite hours to conduct the audit.

The solution? An integrated document management system that streamlines business processes while providing significant productivity gains and unprecedented efficiencies in processing accounting transactions, capturing and archiving HR documents and other enterprise wide processes. Imagine taking the pain out of audits by being able to quickly search an electronic document repository for AP checks and the complete supporting documentation to satisfy even the most diligent auditor. Troublesome audit points generally revolve around lack of visibility to key business processes and the need for improved financial reporting and greater control and oversight over work processes.

With the right integrated document management system you would be able to:

  1. Provide network access to all document transactions and supporting documentation showing who handled, routed, approved and processed transactions.
  2. Document drill down through your accounting solution provides efficient 3- way reconciliation and annotation to make auditing efficient and instantaneous.
  3. Replace manual processes and provide a documented audit trail for the flow of business documents.
  4. Increase visibility by allowing multiple people access to documents versus paper-based records retention.
  5. Integrate with your existing ERP system for minimal data entry by leveraging existing data in the application to index and link documents
  6. Search and retrieve archived documents and supporting documentation in seconds.
  7. Improve financial reporting and streamline GL coding processes
  8. Enhance 3-way match of AP transactions with simple and efficient auditing and routing routines that adhere to documented accounting processes.
  9. Perform internal as well as external audits in half the time of traditional paper-based transaction filing
  10. Enhance compliance and reduce the costs associated with the annual Sarbanes-Oxley 404 audit and regulatory agencies.

With the upcoming audit season upon us, what better time to talk to Axis about the benefits of an integrated document management solution!

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This entry was posted in February 2011, Newsletter and tagged , , , , , . Bookmark the permalink.

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