Audits are a way for businesses to keep their hand on the pulse of operations. Those events, uneven in their occurrence, make sure that the company is on the right track or highlight problems apparent in its financial statements. In either case, virtual data rooms should help.
What is an audit? Why do one?
An unbiased third party conducts an audit to verify that a company’s financials and/or business operations are in order — or they may discover discrepancies that need addressing. There are different types of audits, two of the most common are the financial audit and the compliance audit:
- The financial audit targets everything money-related. The audit team checks if the company’s financial statements accurately represent the business’s health.
- The compliance audit focuses on adherence to rules and regulations. If the company is operating within industry guidelines and according to local or international law, this routine audit should alert management. And even if the audit team finds a fault in the business operations, it is better to be uncovered by the audit team, so that the company can fix their mistakes.
As you can guess, all of those audits require a large amount of data. Financial statements and sensitive documents should be stored in a secure location as well as be accessible to audit teams. This can be accomplished with a virtual data room.
The innovation of virtual data rooms
Why are virtual data rooms such a powerful business tool? Not only are they a secure cloud storage solution, but they also provide collaborative features. You are able to store your sensitive documents without renting out a physical space, and managing a digital data room is much more convenient with search and organization tools.
Features of data rooms that make audits possible
As we mentioned before, audits are full of paperwork. Storing it all in a physical location could be riskier and more costly. This is why we recommend using a modern solution like the virtual data room. This tool is especially useful for audits for the following reasons.
- Compliance. Adhering to rules and keeping tabs on everything related to your business can be achieved by using virtual data room software. You can see where everything is thanks to the folder-like.
- Document storage and structuring. The aforementioned structure is helpful in further management, not only for you but also for your coworkers. Not to mention that it is a secure way to store your most sensitive data.
- Document tracking and reporting. To oversee the safety of your documents, you can create reports about file usage. You’ll know who accessed what documents and for how long.
- Granular permission settings. The more people you have in your company, the more you need to keep tabs on who has access to what files. This is why the granular permission settings are important — they allow certain people to view specific files and prevent them from seeing data that isn’t crucial for them.
- Collaboration tools and Q&A. If you are preparing for an audit, cooperation among your coworkers is a must. With tools in the virtual dataroom environment, like the Q&A feature, you can get the message across and help others understand your point of view. This helps with the workflow when it comes to audit preparation.
Audits can be a work-heavy event in the lifespan of the company. Whether it is a financial or a compliance audit, with the help of the tools in a virtual data room, you will be able to tackle any audit that your business is subjected to. For the best virtual data rooms out there, visit our main page and find out for yourself which of these best fits your needs.