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      As a leader in a privately owned business, how do you view your external audit? Is it just a regulatory requirement you need to go through to tick a box and move on – or is it much more than that?

      Our belief at KPMG is that audit plays a key role in helping businesses of all kinds run themselves with greater insight, efficiency and focus, wherever they are in their lifecycle. This makes an audit just as important for an SME or a fast-growing early-stage business as it is for a FTSE-listed company: it helps lay the foundations to facilitate growth and manage change as the business evolves.

      Whether you’re a start-up looking to reach the point of commercialisation, a growing private enterprise eyeing the next milestone – a fundraise, a flotation, a sale – or an established mid-market company simply looking to continue to profitably trade, your external audit can bring you insights and perspectives that lead to actual operational changes which improve your business.

      That’s why our focus is on enabling you to make the next move by giving you confidence in the numbers behind your decisions, and value-adding insights into where and how your systems and processes can be improved.

      Aimie Keki
      Aimie Keki

      Partner, Head of Audit KPMG Private Enterprise

      KPMG in the UK

      Terri Coughlan
      Terri Coughlan

      Partner, Thames Valley

      KPMG in the UK

      Insights powered by technology and AI

      Technology is at the heart of our audits. As a firm, we have invested heavily in developing a smart audit platform (KPMG Clara) which means audit entities can see audit progress in real time, all in one place, and interact with their audit teams throughout, digitally and in person on site.

      We have embedded significant AI capabilities into Clara which enable us to analyse much bigger quantities of data at source. This reduces manual sample sizes for testing documentation – saving you time and letting your team get on with running your business.

      Technology and AI drive operational improvements because they enable us to spot outliers and anomalies. This is very powerful in a fraud and risk context because we can highlight unusual or suspicious transactions for further investigation. It can also spotlight reporting inefficiencies. For example, in one recent audit our use of AI showed us that the smallest subsidiary in a group was posting the highest number of manual journals (which are more prone to error and therefore risk). We were able to flag this to the management team who can now address this with the subsidiary to improve their data capture and reporting process; saving time and reducing risk of error.

      Relationships based on trust

      But an audit should also be about strong people-based relationships, not just technology. Our audits are centred around this human relationship – of trust, challenge and clarity. However much we use AI, we keep humans in the loop and follow our Trusted AI framework.

      We build relationships that enable better judgement, honest conversations and confidence in the decisions that matter. If, as a CFO or business leader, you don’t feel that you have a relationship of this sort with your auditor – it may be time to question the value you are getting.

      A powerful lens on risk

      A rigorous, technology-enabled and judgement-based audit matters at any time, but it’s perhaps even more important right now given the volatility of the external environment and the rising risk quotient.

      Dealing with volatility means that agility must be baked in, something we’re helping management teams with as conditions change. Meanwhile, the risk environment is intensifying, particularly the cyber threat. Our recently published KPE Barometer found that seven in ten executives (69%) believe the cyber threat has increased. Half of executives agree that other risks have risen too. Boards need to be considering all the what-if scenarios, ensuring they have strong cyber defences all the way along the value chain and building robust business continuity plans. As auditors, cyber risks are an important part of our risk assessment procedures, just as we expect management to assess cyber risks in their going concern and impairment assessments which are then subject to our scrutiny.

      Why you need a quality audit

      So, why should leaders of privately owned companies care about the quality of their audit, and thinking beyond just a tick-box exercise? Quite simply, because it:

      • Reduces disruption for your business, with more work done through technology

      • Reduces surprises for the CFO/leadership team, by bringing sharper, real-time insights and identifying risk areas and outliers that need attention

      • Increases efficiencies and smartens processes that help the business grow, whatever the next stage of your journey is.

      An audit is not just a commodity – all audits are not the same! If you feel that there’s more your audit could be bringing you, then we’d be delighted to talk to you about how a KPMG audit can make the difference for you.

      Our audit insights

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      Our people

      Aimie Keki
      Aimie Keki

      Partner, Head of Audit KPMG Private Enterprise

      KPMG in the UK

      Terri Coughlan
      Terri Coughlan

      Partner, Thames Valley

      KPMG in the UK