Uh oh. The A word. Most people cringe when they hear the word audit, but it doesn’t have to be a bad thing.
Broadly defined, an audit is an examination by an independent public accountant of a company’s financials in compliance with GAAS, SEC or PCAOB standards. It’s used to make sure that the records you’re presenting are an actual representation of the work you’re doing.
Of course, most people think of audits as the IRS way of digging the income tax knife in just a little bit deeper.
External auditors are those who come into your company to perform the audit without working for you, which means less bias and less potential problems in the workplace. But there are internal auditors as well.
Another way audits are actually beneficial is that they show your stakeholders that you’re legit.
Prepare to hear the word a lot too, because unlike most individual taxpayers (hopefully), companies have yearly audits. If your company gets big enough, you could even have monthly audits.
I always want to go run and hide when it’s time for my company’s yearly audit, but everything always works out in the end.