How to Be Ready for a Performance Audit – Five Top Tips
Being ready for a performance audit means avoiding headlines like these:
“F-35 $10-billion fib eclipses fast ferries, convention centre, sponsorships, and Airbus—combined!”
“B.C. Auditor-General stumped by legislature's 'woefully inadequate' accounting”
“Auditor-general rips government over land deal”
A performance audit is an audit of how well an organization or program is being managed. I led performance audits of provincial public sector organizations at the Office of the Auditor General of BC for 13 years. During my years there, I was astonished by how scared people were of the auditor and how ill-prepared they were for an audit. Of the dozens of organizations I audited, I would say only 20% were actually audit ready, and it’s really not that hard.
Here is my top 5 list for how to be ready for a performance audit:
1. Don’t act suspiciously
Auditors are trained to read your minds. Ok maybe I’m exaggerating, but they will be on the alert for incomplete or dishonest responses, and trust me, you don’t want to make your auditors suspicious. If they think you’re lying or omitting information, they will pursue the truth relentlessly.
I led an audit once where the director responsible for the program was acting really suspiciously. The result? It ended up costing the organization way more time and money to satisfy our need for more and more evidence, and it turned out that there was nothing shady going on at all – the director was just nervous about the audit. To avoid being on the receiving end of a suspicious auditor, just be honest and open.
2. Be confident and relaxed
If you’ve never experienced an audit, you might be nervous about being audited. Unless you have something to hide, you shouldn’t be. Reduce your anxiety by asking lots of questions. Ask the audit team to explain the audit, the process and what to expect. It will help you build rapport with your auditor and be more confident and comfortable with the whole process.
3. Keep your files organized and document, document, document
Auditors love to read documents. They will ask for evidence to support just about everything you say so be prepared. They are looking for persuasive, corroborated evidence and they are professional skeptics. This usually means documents and lots of them, sometimes dating back several years. To make this as painless as possible, make sure your documents are well organized and easy to find. My favourite organizations (and the ones that did the best) were the ones that were proactive and would greet us with a binder full of the documents they knew we would need.
4. Be nice to your auditor…really
Okay, you don’t have to hug them – that’s just creepy – but be professional and respectful. It will not help you to make them angry. Just treat them the same way that you would like to be treated, and don’t take it personally when they don’t take your word for something. They’re just doing their job.
5. Take charge – do a self-assessment and take action to improve!
Don’t wait for the final report to take action - do a self-assessment now. Rate your organization against standard performance audit criteria to see how you do and then take action to improve.
We have an assessment tool for this purpose if you need assistance in determining where your organization stands today. If you act on the self-assessment and take steps to make your organization as efficient and effective as possible, you will pass a performance audit with flying colours!