The impact of Covid-19 has brought many challenges for academies over the last ten months, but one rarely mentioned is that faced by finance and management teams as they undertake the annual external audit remotely, says Andy Jones from Cooper Parry.

Remote audit

One of the biggest challenges for academies is time. The reporting timeframe for academies is always extremely tight with audited accounts to be submitted to the Education and Skills Funding Agency (ESFA) by 31 December each year. Because academies and their finance teams had rarely experienced a remote audit or even worked remotely in many cases, our experience was that the whole process took a lot more time compared to traditional ‘on-site’ audit processes.

We don’t yet know what the future holds in terms of Covid-19, but with the expectation of a return to the normal ESFA reporting deadline in December 2021, and more organisations adapting to and moving to remote working, some form of remote auditing may well be here to stay.

The keys to a smooth and effective remote audit

For us, there were a number of key factors in ensuring a smooth and ultimately successful remote audit.

Setting expectations

The key to a successful remote audit lies in consistent, two-way communication. Because auditors aren’t on-site, they can’t just pop into your office to ask questions, so setting the expectations for communication at the outset is vital.

This means being clear with your auditors on how you will work together, including how information will be provided and accessed, how questions will be asked and the timetable you are working to.

Academies and their finance teams were facing a myriad of Covid-19 challenges and priorities through the year end, so we knew they weren’t going to be available to take loads of ‘pop-in’ calls each day. We used an ‘audit tracker’ to help with this. This was a shared document where all the information requests, audit questions and so forth were detailed. Clients could then update this when it suited them best. We even had competition with some clients to see how quickly they could clear the ‘audit tracker’ each day.

Considering your IT capabilities

Considering your IT capabilities is also really important. At Cooper Parry, through the 2020 year-end reporting season we primarily worked with Microsoft Teams, but some clients had initial difficulties using Teams, so it’s important to ensure you understand from the outset how your auditors will want you to share and upload information with them.

With IT, it’s also really important that you can provide remote access to your accounting and finance system to your auditors, as this can save a lot of time for your finance teams in having to upload various reports and information from the system.

Ensuring regular touchpoints

Setting regular touchpoints with the audit team through the audit process is also really important. What we found worked really well with clients was having a check-in call at the end of each day. This enabled us to give them an update on audit progress, discuss the ‘audit tracker’ and any other outstanding information or questions. This helped in ensuring the audit kept moving forward and everyone involved was also on the same page.

Organising your documentation

A lot of the external audit is about supporting documentation, and organisation is the biggest key to success here. Organising the documentation in a way that directly ties each piece back to the original information requests, or follow-up questions, really reduces the further questions your auditor will have. Some clients numbered the documents based on the audit request list, while others used folders labelled by date and specific area of the audit. Getting that documentation organised early in the process is also key; it will save time further down the line.

This is where using Microsoft Teams really helped. It enabled information to be shared with the whole audit team, which made resolving any questions on those documents much easier. While we found that many clients had hardly ever used Teams before the audit, they are now all ‘dab hands’.

So, how ready are you for your next remote audit?

Andy Jones
Not for Profit Director and Academy Audit Specialist at Cooper Parry – an ASCL Premier Partner.
www.cooperparry.com

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