Are you looking for new ways to reduce operating expenses? Then focus on your company's annual audit. You're probably paying too much for it.
Don't worry: we're not suggesting that your company settle for a slipshod audit in order to cut costs. There's a better solution, suggests Christopher Hanson, whose Boston consulting firm, Pretium, helps companies reduce excessive accounting fees: "Companies need to figure out ways to do some of the preparation and auditing tasks internally, rather than pay outside auditors to handle them at rates as high as $350 an hour."
Here are some of Hanson's money-saving tips:
Â· Analyze work sheets from earlier years. Determine which numbers and documents your outside auditors will need. Track down and organize everything.
Â· Set real, doable tasks during the audit-planning meeting. "Normally, this is a short gab session, but it can be much more useful if the chief executive and chief financial officer spend several hours looking for ways to make the outside audit progress more efficiently." Your goal: find jobs that internal staffers can handle.
Â· Question out-of-pocket expenses tied to your auditor's bill. "These are regularly inflated by excessive copying fees, meal charges, and other costs that clients should not have to cover. Challenge anything you think is out of line."
Hanson's valuable paperback guide, You're Paying Too Much! (The Pretium Publishing Co., 508-887-9800, 1995, $14.95), offers more ideas.* * *