First-year audits: what finance teams underestimate
Opening balances, prior-period schedules, and why the first engagement takes longer than the second.
A first-year audit spends real time on opening balances. Even when prior figures look clean, the new auditor must obtain comfort that equity, fixed assets, and tax balances start from a reliable point.
Prior-period schedules that were never formalized become a scavenger hunt. If depreciation lives only in a spreadsheet with undocumented assumptions, expect questions.
Related-party listings are often incomplete in growing family companies. Gather director and affiliate names before fieldwork; updating mid-engagement slows everyone.
Document retention habits matter. Missing contracts for significant leases or loans force alternative procedures that extend the calendar.
Plan for a longer closing meeting in year one. Clarifying accounting policies once usually shortens every subsequent engagement.