There's a big problem at CPA firms and internal audit departments all around the planet. It's simple. Most audit workpapers take too long to review. With few exceptions, audit workpapers are hard to follow, sloppy, unorganized, overly complicated, and a host of other adjectives.

No, we are not exaggerating or blowing a small issue out of proportion. Workpapers really can be difficult to review. And the impact on efficiency, morale, and quality can be deadly.

Well, there's good news. The status quo is avoidable. Audit workpapers need not be eyesores. The review process does not have to be painful. And, perhaps best of all, the problem is fairly easy to fix. The solution doesn't require investments in technology, changes in firm policy, or anything that requires the involvement of other people. It simply requires that you implement the recommendations in this article.

Before we continue, though, a quick point may be necessary. Making your workpapers more reviewer-friendly doesn't mean making them "picture-perfect" or gorgeous (which can be a waste of time). It simply means implementing easy steps that will dramatically save time in the review process.

Before looking at the sample workpapers on the accompany page, let's make sure everybody understands why this topic is so important.

Review-friendly workpapers:

1. Dramatically reduce the review time of people with higher billing rates.
2. Save the time of staffers since there will be fewer review notes to clear
3. Improve quality by helping to ensure that the staff understand what they're doing and by lowering the chance that something will be missed
4. Reduce the money spent on aspirin for both reviewers and staffers

Six Steps to Review-friendly Workpapers

Use More Space
Don't cram tons of stuff on a workpaper. Use more space than you think you'll need. Then there will be plenty of room for adding comments, if necessary. White space on the paper is lovely!

Be Neat
If your handwriting is terrible (you know who you are), then prepare more workpapers on your computer. Otherwise, slow down and write legibly. This saves a great deal of time later in the audit.

Organize Workpapers Logically
Workpapers should be numbered in an order that facilitates an easy review. Put some though into it. Keep similar topics clustered together (e.g., confirmations/alternative procedures might be located in the B-10 series while bad debt testwork is in the B-20s). Also, show consistency. If you've put cash reconciliations on A-2, A-3, A-4, and A-5, then make sure A-6 is a reconciliation too. If not, don't use A-6. Even little things help out most reviewers.

Use Less Color
Some people go wild with different colored pencils and pens. A workpaper should not look like "The Strip" in Las Vegas. The finished product should be easy on the eyes.

Eliminate Clutter
Get rid of anything that doesn't add value and merely clutters up the paper. This includes wordy memos, duplicative explanations, useless comments and columns, etc. If cluttered schedules are prepared by a client, work with them to change the format, or obtain the information on disk so that you can quickly make modifications.

Explain Your Approach
In bigger audit areas, it's often difficult for a reviewer to figure out what's been done unless there is a memo that "pulls it all together." This doesn't have to be a major masterpiece -- just put together something that prevents the reviewer from having to dive straight into the details.

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A Tale of Two Workpapers

Example One:
It hurts just to glance at this thing. Sloppy. Crammed Lots of arrows. Excessive tickmarks.

The first three explanations are unnecessary (they should be standard tickmarks). The next two tickmarks are too similar and can cause confusion. Actually, they're unnecessary as well.

This last explanation goes on and on and on! Maybe this person could learn a thing or two from the Gettysburg Address!

Example Two:
How about comparing this to the monstrosity above? Less clutter. Fewer tickmarks. Simpler.

But that's not all. This auditor cleaned up the PBC while checking formulas, thereby eliminating unnecessary rows and those awful pennies. He also reduced the need to flip back and forth between other pages.

And is it a coincidence that this auditor hit upon a potentially-major issue? That's right, what happened to the old ski life? The first auditor failed to think about this issued in his pathetic and cluttered mess.

And don't forget, the review time is much less!