Office Shutdown? Virtual Audit is No Problem for Client
Client: Large Public Company
Requirement: NetSuite Implementation
Business Situation:
In March 2020, as lockdown orders went into effect as a result of COVID-19 and employees at a large Public Company were being sent home and told not to come into the office for the foreseeable future, the finance team realized it had an issue on its hands — how to handle the annual audit that was then underway.
ProNexus Solution:
Fortunately for the cloud-based analytics and business intelligence software company, it has been running NetSuite since before it went public, and its audit team had been accessing the system remotely for years. So, the audit continued with virtually no delay.
“There was no big meeting,” said their director of revenue and financial reporting. “It was just, ‘fine, that will work.’”
Indeed, having auditors come into the office to get their work was done more out of tradition than anything. “If they had approached us at any time and said would we be okay doing it virtually, I don’t think we would have had an issue,” he added.
It wasn’t unheard of to conduct virtual audits before the pandemic, of course. And while many, like this client, had automated processes around an audit, paper documents remain common in many organizations.
For the client and its auditors, the change essentially meant there were no in-person conversations and both the client and its auditors had to be a little more deliberate about setting up meetings, but otherwise, it all went smoothly. The audit of the organization’s annual financial statement had begun in mid-February and still finished on schedule in early April.
NetSuite’s cloud-based system allows people outside the business, like auditors and outsourced accountants, to access company financial records remotely, with just a browser and an internet connection.
“Our auditors always appreciated having access to NetSuite and being able to self-serve,” the client said. “That continued to be a theme.”
In fact, many NetSuite users had already begun conducting virtual audits and are more than happy with the results.
Clients can facilitate audits by building in auditable workflows like delegation of authority that auditors can then access by creating customizable NetSuite workflows and scripts. Take, for example, a situation where any transaction over $10,000 requires the sign-off from a CFO or finance manager. In the past, the only way to verify that might have meant pulling a piece of paper out of the AP drawer and seeing if there were two signatures on it.
Not only is the record permanently in NetSuite, but the processes are repeatable. For auditors that might ask for 40 different reports on the general ledger, accounts receivable accounts payable, and more, NetSuite users can create a dashboard that delivers those reports via Saved Searches. With a NetSuite auditor’s license, auditors can access the system and simply retrieve those reports.
For the client, NetSuite has also helped with its first SOX 404 audit, which covers internal controls testing. The client has created workflows to ensure that the proper transaction approvals are obtained and recorded. When the auditors need to check, they just pull the transaction and review the workflow history.
And how would this all have gone if the client was still on its previous accounting system?
“We were using well-known software that wasn’t natively built for the cloud or for the enterprise so it would have been a disaster,” the client said. “NetSuite is designed for companies in our situation. Not only on the business process side but the IT side. The ability to implement logical access and change management controls would have been impossible with what we had before.”
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