Practice Management QuickBooks

AuditFile Helps with Accountant Prepared Financial Statements

Written by Peter Cullen

AuditFileI was recently introduced to a software product called AuditFile. This is a cloud-based audit, review, and compilation efficiency tool that accounting professionals who prepare financial statements may find very useful. I spoke with the founders of AuditFile, Gary and Kevin Bong (father and son) – Gary is a practicing Accountant and Kevin is a software engineer with an accounting background. That told me a lot right there, with the combination of the accountant and the technologist, working on solving an important problem that we all contend with.

Many accounting professionals have experience creating basic financial statements to fulfill a client requirement. At the core, these consist of the Comparative Balance Sheets, Income Statements and Statements of Cash Flows. There may also be a requirement for additional reporting such as Accounts Receivable Summaries and the like. Clients need their financial statements prepared by their accountant to fulfill a variety of requirements – developing a business plan, budgeting, annual fiscal & tax compliance and reporting, lending, underwriting, RFPs, potential acquisition, and many other business needs. We all find ourselves being asked to fulfill these critical needs for our clients. In my own experience, the quality of the financial data we work with has a proportional relationship to the extent to which the client effectively uses their QuickBooks data file. If 100% of the business processes are tracked in their QuickBooks file, the likelihood is that the financials generated from within QuickBooks will be comprehensive.

However, more often than not, the client utilizes some business processes (as an example billing, manufacturing, depreciation, tracking multiple sales channels, etc…) outside of QB and thus there is a requirement to adjust the financials coming from QuickBooks in order to develop a complete assessment of the financial health of the company. It becomes incumbent upon the accountant to develop a system for compiling the essential elements of the financial statements, and to develop procedures for systematic production of the financial statements. This is where AuditFile can be quite helpful.

The developers of AuditFile have created a cloud based Practice Efficiency tool that enables the accountant to build these systems and procedures, document them for each client, pull the trial balance data from the Client’s QuickBooks file. The resulting financial statements are completely documented, incorporate an audit trail (including documentation needed for adjusting journal entries), work paper references, tie-outs to lead schedules and much more. No longer will we need to rely on Excel spreadsheets and email communications to insure for ourselves that the resulting financials represent the complete efforts expended to create the financial statements.

Let’s take a look at what the product can do. Here’s a summary of the planning section for a review client  (you can see how many of the procedures we would want to document are already designed into the product.

AuditFile planning summary

The application has an easy drag and drop capability to attach documents to corresponding areas of the engagement. Here is the Engagement Letter section, you can see the area that lets you easily add documents.

Audit File engagement letter

At this time you enter your accounting data through their import utility. This takes data from an Excel or a CSV file. You will save your Trial Balance from QuickBooks (desktop or Online) to Excel and then import it here. AuditFile is working on a direct integration with QuickBooks Online, due later in 2015, and is looking at options for QuickBooks desktop.

AuditFile upload trial balance

The application has an excellent work program section to enable checklist style completion with an area for comments with respect to applicable segments or areas of the financial statements.

AuditFile summary

Recently the AICPA has even gotten in on the Act. The details of the recently announced SSARS 21, relating to Accounting standards for Review and Compilation of Financial Statements, demonstrates that the AICPA, and subsequent announcements by State societies, will have an impact on the obligations and practice standards required in the preparation of client financial statements by members of the AICPA and various state societies.

In addition, AuditFile incorporates a tax module to help document, organize, and track tax engagements.

AuditFile is reasonably priced when compared to other similar tools. The application offers a few simple pricing options with no binding contracts. Pricing starts at only $49/user/month for the compilation and review package. The full audit package is only $99/user/month.

So, if you are a QuickBooks ProAdvisor firm that regularly is asked to generate financial statements for your clients, and would like to gain control over the process and procedures involved in creating these financial statements, and further would like to produce a professional product that is sustainable and engenders the trust and confidence of your clients, I recommend that you take a close look at AuditFile.


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About the author

Peter Cullen

Peter Cullen is a Partner at Core Performance. Our passion is to make real the promise of managing your Organization with "Real-Time Information" using the latest in online accounting and financial management technology tools available to business owners. Our cloud accounting experts can help you elevate your business to the clouds.

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