5 ways your auditor could make you money, instead of causing you headaches

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5 ways your auditor could make you money, instead of causing you headaches

5 ways your auditor could make you money, instead of causing you headaches

For many companies, the annual audit is a necessary evil, something that is endured rather than enjoyed, and rarely seen as an opportunity to get external expert advice. Unfortunately, many auditors live up to this stereotype and the relationship between auditor and finance team can be a strained one. 

But it doesn’t have to be this way. In fact, if you work with the right auditor, they could find ways to save you money, rather than cause you headaches. 

At Creaseys, we pride ourselves on always taking into consideration our clients’ Big Picture, so we thought we would share five scenarios that might inspire you to think a little more carefully when you appoint your next auditor. 

Scenario One – overly complex group structures

Our first example is from a UK and European pharmaceutical group, who should have been audited for the three years that preceded them appointing Creaseys as their auditor.  The Creaseys team delivered the audit on time and on budget, but more importantly, during the course of our work, we identified a huge opportunity to save substantial audit costs in the future.  

With the parent company in the UK and seven subsidiaries throughout Europe, the client had to prepare audited group accounts and have all of its subsidiaries audited for the purpose of those group accounts.  We advised the client to restructure the group so the parent company was not in the UK, which would avoid the need for all of the group companies to be audited in future.  We also worked with the client to identify a suitable jurisdiction in which to locate the parent company, considering the tax and commercial risks.  Ultimately, we helped the client save over £100k of annual audit fees.  

We’ve had similar examples of new clients coming to us with unnecessarily complex and large group structures, and we’ve worked with them to simplify, and reduce their audit and other overheads. Is your auditor looking at the bigger picture of your organisation, or just going through the motions?

Scenario Two – unclaimed R&D

Creaseys were appointed as auditors for a construction group, and we quickly identified the client had not been making research and development tax claims they were eligible for.  Working with our R&D specialist partners, we were able to secure an R&D tax credit in excess of £700k. 

Scenario Three – surplus cash

Whilst working on the audit for one of our existing clients, we identified they had substantial amounts of surplus cash. Because the Creaseys team works closely across disciplines, we raised this as an opportunity for our client with our tax advisory team, who subsequently worked with the owner to create a family investment holding company. This allowed the excess cash to be passed up and invested by the family in property and equities; a strategy that meets the family’s long-term objectives and mitigates significant amounts of tax.

Scenario Four – reducing commercial and tax risks

Working with a sporting venue management company, we identified that the group’s land and trade were held together in various companies, leaving them open to commercial and tax risks, particularly at a time when the group was making a substantial loss. The Creaseys team recommended the land and trade be held in separate companies to mitigate these risks and worked with the client and their lawyers to successfully restructure the group.

Scenario Five – business sale and acquisition

Our audit team has helped a number of clients who were selling their businesses or acquiring other companies. These projects are led by separate teams for ethical reasons, but it is often the insights provided through the audit team which has significantly impacted negotiations for the better of our clients.  A great audit team should always be looking at the bigger picture for their clients and be ready to bring in other experts when the opportunity arises. 

So there you have it, five ways your auditor could be saving or making you money, rather than causing you headaches each year. 

If you’d value a confidential chat with one of our audit directors, click here to get in touch – we’re always happy to help.