The challenge
Every year the statutory audit consumed the business for roughly three months. Not because the company was badly run, but because nothing was prepared in advance and the finance team was answering auditor queries while also trying to close current months.
The pattern is familiar and self-reinforcing. Auditors ask for a schedule that does not exist, someone builds it from scratch under time pressure, the answer raises a further question, and current-month bookkeeping slips further behind. By the time the audit signs off, the business is two months behind on its own numbers.
The finance manager estimated he spent 60% of his time between January and March on audit support. That is a third of the year in which nobody was watching the business.
How we worked through it
- Two months before
Building the PBC file
The prepared-by-client list is known in advance every year. We built the entire file before the auditors were appointed: bank confirmations, fixed asset register, AR and AP ageing, related-party schedules, lease workings.
- One month before
Reconciling everything first
Every balance the auditors would test was reconciled and supported before they arrived. The fixed asset register — which had never been reconciled to the ledger — took the longest and turned up SAR 210k of assets disposed of but never written off.
- Audit weeks 1–3
Handling queries directly
Auditor questions came to us, not to the finance team. The client’s staff carried on running the business, which is the entire point.
- After sign-off
Making next year automatic
The schedules the audit needed are now produced as part of each monthly close, so the following year’s file assembles itself.
Backlog / balance over the engagement
The result
The audit closed in three weeks with a clean opinion. The following year it took two and a half.
Management time lost to the audit was effectively zero — queries were absorbed by us rather than by the client’s team.
The fixed asset reconciliation also removed SAR 210k of assets that had been disposed of years earlier but never written off, correcting both the depreciation charge and the asset base.
An audit is only painful when it is the first time anyone has looked. If the reconciliations the auditor will ask for are produced monthly anyway, the audit becomes an inspection rather than an excavation.
