Finance Transformation
How to Manage an Audit Without It Wrecking Your Quarter
1 August 2025
Audit season in most finance functions is a period of disruption that the team dreads and management notices. The auditors arrive, they ask for things, more things, and then more things after that. The finance team stops doing its normal job to respond to requests. Month-end is late. Management reporting slips. The FD spends three weeks in a meeting room explaining last year’s decisions to people who were not there.
It does not have to be like this. A well-managed audit is a defined process with a known endpoint, conducted mostly by the client team providing well-organised information to auditors who spend their time auditing rather than hunting for documents.
The difference is preparation, relationships, and an understanding of what auditors are actually trying to do.
What auditors are actually doing
Auditors are forming a view on whether the financial statements give a true and fair view. To do that they need evidence that the balances and transactions in the accounts are complete, accurate, and appropriately valued, and that the accounting policies applied are consistent and appropriate.
They are not looking for problems. They are looking for evidence. The more organised and complete that evidence is, the faster the audit goes and the fewer additional queries arise. Every additional query is the audit team finding something they could not resolve from the information already provided, which means a conversation, a delay, and often additional work on both sides.
The job of the finance function in an audit is to give auditors the evidence they need, organised clearly, with enough context that they do not need to ask.
The preparation that makes the difference
An audit file built throughout the year, not assembled in January. Every significant accounting judgement, every material accrual, every provision, and every unusual transaction should be documented when it happens. A clear record of what it is, why it was recorded the way it was, and what the supporting evidence is. Assembled into a structured file throughout the year, this becomes the audit pack. Assembled in the three weeks before the auditors arrive, it is a scramble.
A prior year query log. Keep a record of every query raised in the previous audit and every additional document requested. Before the next audit, check that the same information will be available and organised in advance. Recurring queries are usually the result of recurring gaps in the evidence package, not recurring problems in the accounts.
Clear reconciliations for every balance sheet line. This includes intercompany balances, which are among the most common audit queries. Every balance sheet balance should have a supporting reconciliation that ties it back to a source document or a calculation. If the auditor cannot follow the reconciliation without a thirty-minute explanation, it needs to be rewritten. The test is: could a competent auditor pick this up cold and understand it?
A schedule of significant judgements and estimates. Provisions, impairments, accruals for uncertain amounts, revenue recognition judgements: these need to be documented with the assumptions used and the sensitivity to those assumptions. Auditors will focus on judgements. Having documented accounting positions prepared in advance shortens the conversation significantly.
The relationship question
Auditors are people. They respond to the same dynamics as anyone else. A finance team that treats the audit as adversarial, provides information reluctantly, and escalates every query to a disagreement will have a longer, more expensive, and more disruptive audit than a team that communicates openly, flags issues early, and maintains a working relationship with the engagement team throughout the year.
The relationship is built in the eleven months between audits as much as during the audit itself. A brief quarterly update call with the audit manager, flagging significant transactions or judgements as they arise during the year, means that nothing the auditor encounters at year-end is a surprise. Surprises create delays.
The timing question
If your audit runs significantly later than planned every year, the cause is usually one of three things: the accounts are not ready when the audit starts, information requests take too long to respond to, or there are unresolved accounting disagreements that extend the clearance process.
All three are manageable with the right preparation and relationships. None of them require a longer audit. Audit findings in inherited functions are often the most difficult to resolve because the documentation was never created in the first place.
Maebh Collins is a Chartered Accountant (FCA, ICAEW) with Big 4 training and twenty years of experience managing statutory audits from both sides of the table.
Maebh Collins is a Chartered Accountant (FCA, ICAEW), Big 4 trained, with twenty years of experience building and running international businesses. She specialises in finance transformation, ecommerce operations, and digital strategy.