Using Basecamp To Manage Audits

This post provides information about using Basecamp to manage audits.

Most auditors do not plan. We repeat, using the same prior year procedures and processes.

The result: increased audit risk and lower engagement profit–just what we don’t want.

Using Basecamp to Management AuditsThe Problem

We make carbon copies of prior year work papers with updated numbers. By performing the same audit steps and not incorporating procedures responsive to current risks, we leave ourselves exposed, with the potential for issuing errant unmodified opinions. Also, our profit margins lessen as engagement time balloons–auditors tend to add audit steps and don’t prune away the old. It’s the worst of both worlds: increased risk and lower profit.

A Solution

Could project management help?

Yes.

When I use the phrase project management, I mean a formal method–might I even say discipline–in planning and executing procedures. Yes, I am using the “D” word: discipline. And why might we avoid project management? Let me use the “L” word: lazy. Right now you are probably thinking, “Charles, are you asking me to think more? Don’t you know how stressed I am?”

But would project management require more thinking? Project management requires us to think more early on and less overall. And, by doing so, you will have less stress. With appropriate discipline, we decrease the overall effort to complete the job.

A lazy auditor simply repeats without thinking (no planning). A disciplined auditor plans and then acts. Motion without thought is just wasted energy. It might look impressive but achieves nothing.

The Project Management Institute defines project management as a temporary group activity designed to produce a unique product, service or result. A project is temporary in that it has a defined beginning and end in time, and therefore defined scope and resources. And a project is unique in that it is not a routine operation, but a specific set of operations designed to accomplish a singular goal.

Project management for auditors includes:

  • Identifying project stakeholders, their needs, and their participation
  • Planning tasks to be performed (even if you’ve done the job a hundred times)
  • Creating a timeline
  • Creating and assigning tasks
  • Identifying potential bottlenecks
  • Identifying risks (during planning and fieldwork)
  • Monitoring task completion

Most electronic work paper files are used to manage projects. Visually you can see what is complete and what is not. Auditors scan the work paper sign-off list as one way to monitor the project. But what if you have four or five simultaneous audits? Or maybe you’re out of the office with just a cell phone. How do you see the status of your audits? How do you remember all that needs to be done?

Basecamp Project Management Software

What project management software do I use?

Basecamp.

I normally have about a dozen projects (e.g., audits, peer reviews, CPE classes I’m planning to teach) at any one time, so it’s challenging to keep everything moving in the right direction. Basecamp enables me to do just that.

Basecamp allows me to:

  • Carry on discussions with audit participants
  • Create to-do lists
  • Assign tasks to project participants with desired completion dates

Here’s a sample screen shot from Basecamp. (Notice I am not repeating my audit program here–just what is needed to manage the project.)

Basecamp

As a task date nears, the designee automatically receives an email reminder. For an audit project, that person might be a staff auditor, an in-charge, a client, or even yourself.

Many projects don’t get completed on time because we don’t early-identify potential bottlenecks (e.g., your in-charge is assigned to three engagements the week preceding the audit issuance date). And then when they occur, we blame the bottleneck rather than our lack of planning. We act surprised, as if projects never have hiccups. Project management enables you to plan early for problems. Then if problems occur (and they will), you can amend the project plan, and, if needed, change the scope or procedures, or add more resources.

Another nice feature in Basecamp is the ability to post messages. Since these messages are isolated by project, you can see the ongoing engagement conversation without digging around in your email archives. You can also attach documents (e.g., Excel spreadsheet) to a message.

If you have multiple projects going on at the same time, Basecamp enables you to move quickly from one project to another to see the status of each.

In Basecamp, you can categorize your to-do lists. My audit categories are:

  • Planning
  • Fieldwork
  • Review
  • Financial Statement Preparation
  • Exit

Then under each category, I add to-do tasks, assigning each to an individual–usually with completion dates (adding completion dates is optional in Basecamp).

As you complete a task, you check it off and it disappears (archived in the project, but no longer in your visible task list), leaving only those items that need to be completed. So you start out with this full audit project list, but as you move through the project, the list decreases in size.

You can access Basecamp from your cell phone, your computer, or a tablet. And so can all project team members, even your clients (if you add them to the project). Here’s a sample cell phone screen shot, reflecting a few projects I’m presently working on.

iPhone Basecamp

Additional Information

You can also create Basecamp templates (a sample project with a list of normal to-do items) which can be used to set up new projects.

The cost of Basecamp is $50 per month for forty simultaneous projects. Old projects can be archived and are not counted as one of your forty projects.

A cheaper alternative is Trello. I have not used Asana, but I have heard good things about the product. Both Trello and Asana have free basic products.

For you serious project management professionals, check out my twin brother’s project management website at projectriskcoach.com.

Learn from the CPA Scribo newsletter!

Get my free weekly accounting and auditing digest with the latest content.

Powered by ConvertKit

Please note: I reserve the right to delete comments that are offensive or off-topic.

Leave a Reply

Your email address will not be published. Required fields are marked *

6 thoughts on “Using Basecamp To Manage Audits

  1. Thanks Armando. I have found Basecamp to be a life saver (though I think Trello would be equally as helpful). I like feeling like I am in control of the elements (all that we have to do) rather than them being in control of me.

  2. I was not aware of Basecamp. For audits I have and I am using Excel. I prepare a detailed budget, which is one column. Then I have one column for each, posting the time, thus I know how much time is charged vs. budget and it also helps me to know where I am in the audit. For the to do for each audit client, when in process, I have a worksheet in the same Excel file of To Do for minor things, otherwise it would be included in the main one. I have been looking at Trello since I read about it in CPA-Scribo. For many years I used the Palm personal data assistance, I liked I t a lot and was sorry when they went out of business.
    Thanks for such good information, Charles

  3. I have just begun to experiment with Trello for audit management. One potential issue I see is that once tasks are “completed” by staff, there needs to be a review completed before the task is truly done. How do you handle that handoff from when the staff is done through the review process?

    • Brad, I do this two different ways:

      (1) Sometimes I queue this up as a to-do item in Basecamp, for instance: “Review Receivable work papers” — and I assign it to myself. (I can see in Basecamp when the staff member has checked off their to-do list item for the assigned work papers.)
      (2) Sometimes I just wait to see that the staff member has signed off electronically in Caseware (the paperless software we use), then I follow up with the review.

      The size and complexity of the engagement drive my decision of whether to do (1) or (2).

  4. I use Excel for many different purposes, so far so happy. Obviously, it is not a dedicated program, so it is worth to look at these other programs.