How Do I Prepare for a Sales Audit?

A sales audit is a formal review process that analyzes a company’s sales team and/or sales department. The review typically includes the sales structure, system, staff, skills and strategies. The sales management team usually is responsible for handling the audit. To prepare for the sales audit properly, the sales management team should meet with the auditors, ask what areas will be under specific review, prepare documents ahead of time and request a follow-up meeting with the auditors to discuss the final report. The sales management team might also need to meet with the company’s management to discuss the sales audit.

Auditors will most likely schedule a pre-audit meeting with the department under review. This allows the auditors to create an audit plan and schedule for the sales audit. A time line is necessary to ensure that the auditors can properly review all items and not create cost overruns during the process. A contract or other agreement might also be drawn up at this time. The formal agreement represents the official start of the audit process.

The sales management team typically needs to know which specific areas or items will be under review in the audit. The sales manager will usually gather information for the “prepared by client list,” which consists of the reports that auditors review during the audit. Auditors will need physical copies of the reports that they need in order to recalculate or compute sales figures. This information is often for consecutive months. Auditors use standard auditing principles to test the accuracy and materiality of information.

The audit usually will end after a week or two, depending on the areas under review. Auditors will retain their working papers and create a final report for the client. The sales audit final report will list any deficiencies or issues auditors discovered during their review phase. The final report should also have recommendations for the sales management team. Public companies might have the sales audit report released to the public for review by stakeholders.

Public companies often undergo several audits during the year. These audits ensure that a company is in compliance with the laws and accounting standards that are necessary to protect shareholder investments. A company that fails a sales audit might need to undergo a remedial audit. The sales management team needs to prepare for the second audit in a manner that is similar to the first audit. Corrections in the failed areas usually are necessary before the auditors come back and review the information.