Most business owners cringe when they hear the word “audit,” but the truth is that an audit isn’t necessarily a bad thing. Once you learn more about what an audit is and how it works, you will see that there are a few ways in which your company can benefit from the auditing process.

Here are a few ways that an audit can help your company:

• Identify problems and weaknesses with your accounting system, allowing improvements to be made to eliminate these problems in the future. It might be discovered that the system isn’t tracking certain transactions correctly. Or maybe you will find errors in payments that need to be corrected.
• Uncover fraud, which could potentially include situations where employees or management are stealing money from the company. An auditor will identify discrepancies so that you can eliminate the problem.
• Identify poor accounting practices, such as employees who are getting lazy about performing the correct financial tracking steps. It is hard to see these issues unless you can view the overall picture, which is possible with an audit.
• Improve tax planning, to ensure that you are ready for tax season and that you are leveraging tax write-offs and benefits as much as possible. By planning ahead, taxes are less stressful and easier to file.
• Strengthen the credibility of the company's financial records, which is important if you are planning to sell within the next few years. When you have documented information showing the success of your company over multiple years, then it will be easier to prove the financial security of the business.