What Does an Audit-Ready Organisation Look Like? NFP & Education Finance Specialist Breaks It Down
Treat every month like audit season, and you get a proactive finance team with the answers that auditors look for, and more confidence from the auditors as a result.
What Nunzio Giunta's experience has been, working with NFP and education organisations when they first approach him, is that the month-end process drags into a fresh month, reconciliations are still being chased for a past invoice, revenue recognition streams are incorrectly identified, and all of it remains unresolved by the time audit season arrives.
When it comes time to book the audit session, anxiety sets in, because the team can't respond in a timely manner and pushes back on when things can actually happen.
Auditors pick up on this instinctively, and the conclusion they draw is simple: the team isn't ready to present their reports.
When auditors step into an organisation, they are often reading intangibles. They gauge the readiness of the finance team, and more importantly, how much information is already available before they even have to ask for it.
It comes down to being ahead of the auditors, with all the relevant information categorised in a way that signals, instantly, that they're dealing with a proactive team.
Here's where that starts.
Revenue Recognition Is the First Gap You Can Eliminate Before Audit Season
Audit sessions aren't meant to scrutinise finance teams who already spend the majority of their time ensuring accuracy. That said, revenue recognition is one area that consistently needs extra care, and it's something Nunzio can't emphasise enough.
Auditors focus a lot of energy and time here: whether the team has been diligent in understanding the accounting standards, how they've been applied, how revenue streams have been calculated, and whether the policy in place actually results in recognition being satisfied.
Before audit season, here's what to action:
Confirm your revenue recognition policy is documented, not just understood informally by the team
Have a transparent, upfront discussion with your auditors about that policy, before the audit commences, especially critical if a new auditor is coming in
Check every revenue stream against the policy, not just the largest or most obvious ones
Verify the calculation method is being applied consistently, month to month, not recalculated differently at year end
The Finance Team That Still Has a Month-End That Drags Into a New Month, Every Time
Nunzio paints a realistic picture when talking about month-end close.
In our experience working with finance teams on audit prep, the chaos really sinks in at every month-end. Finance teams go quiet as July hits, and the next three months, well into October, become a race to catch up and close the books correctly.
If that's where you are as you're reading this, it's worth pausing to reflect on your current practices. But say you're a finance team that has already worked towards a continuous close, that order holds every month.
For that team, the auditor walks in, reviews everything within two weeks, and it's done by the last two weeks of June. That frees up August and September, the two months where finance teams are usually stressed and deep in back-and-forth with auditors. Audit becomes something that's dealt with throughout the year, not concentrated into it. By the time it actually ends, it's a formality, sign-off rather than a scramble.
So how much time are finance teams actually saving by adopting a continuous close practice ahead of audit season?
Nunzio's answer is calm and consistent: time, energy, and a lot of manual work sorted out early in the audit journey. For Giuntabell's clients, that repetitive, manual work is handled by a system instead, so teams go into audit season feeling ready and confident.
Does a Rockier Month-End Close Mean a Longer Audit Experience?
Nunzio's answer is simple and straightforward: if teams are efficient at month-end close, wrapping things up within a few days and confident in the numbers, that translates directly to a smoother audit, without requiring any manual load.
It also means bottlenecks get sorted early. When month-end drags out beyond ten days, the reality is that teams are forced to go back and fix reports, process old invoices that should have already been accounted for, and board reports end up based on incomplete numbers. Then, when the auditors arrive, gaps that should have been addressed months earlier start to surface, revenue recognition that wasn't dealt with, accounts that were never truly reconciled. That's when panic sets in.
If a team is reconciling everything properly on a regular basis, there are no surprises. Close each month, finalise everything, and catching up simply isn't something to worry about.
What ‘Confidence’ Actually Looks Like During Audits
Finance teams have a responsibility, not to ensure the numbers are good or bad for the organisation, but to ensure every number is defensible, accurate, and can be presented to auditors with confidence.
That's where finance teams are required to flourish. They should be able to look at the balance sheet, at every single account, and answer immediately why that number is there. Real confidence means the balance is substantiated, validated through multiple sources rather than just internally checked, and ready to stand on its own.
When finance teams get this right, it isn't just about being ready for an audit. It's being able to forecast that the organisation might face a problem six months out, which enables better decision-making at board level. That's why finance's role is so critical.
"If the finance team's not sure, you can't communicate that effectively, and it will start to hide that number until it's too late."
— Nunzio Giunta, Founder, Giuntabell
What Finance Leaders Should Do Next
Once you've identified the gaps, the next step is building habits that carry on every day, rather than a last-minute scramble before audit season.
Across more than 70 implementations, Nunzio has consistently found that:
technology never makes the biggest difference on its own. It always comes down to the people, and the habits and practices they build around the system.
Being open to transforming those daily habits, paired with the commitment to keep evolving and improving, is what actually moves the needle.
There is no such thing as a perfect month-end close. It doesn't exist. What does exist is the ability to keep getting better.
"I think it comes down to attitude. In the not-for-profit and education sector, it's about looking for one per cent improvements every day. If you look at the whole problem at once, it's overwhelming. But if every month you ask what you learned and what you can fix next month, and you keep doing that, you look back after a year and the changes are remarkable."
— Nunzio Giunta, Founder, Giuntabell
Not sure how close your own month-end really is to audit-ready?
Take the free Close Lag Self-Assessment to see where your organisation stands, and what a realistic path to a continuous close actually looks like.