Article
Eight key aspects of a successful financial statement audit for life sciences companies
Oct. 9, 2022 · Updated May 21, 2025 · Authored by Carolyn Gile, Samantha Benner
Financial statement auditing can seem like an overwhelming process for life sciences companies that have never completed one. Getting an overview of what life sciences organizations can expect from an audit along with an understanding of the eight main technical accounting aspects of the audit itself can help to simplify the process.
What’s a financial statement audit?
A financial statement audit is when an independent public accounting firm reports on the compliance of a company’s financial statements and footnotes in accordance with U.S. generally accepted accounting principles (GAAP).
To issue this report, an auditor will design and perform audit procedures, which include understanding the control environment of a company and examining individual transactions on a test basis.
A financial statement audit is executed in three phases: planning, fieldwork, and reporting.
Having financial statements prepared in accordance with GAAP helps a company to execute future transactions and provide investors with comparable and understandable financial information.
Planning
Management needs to take ownership of their financial statements and prepare before auditors begin testing. The expectation is that a company’s accounting records would be closed prior to the start of fieldwork.
Planning an audit involves developing a comprehensive strategy and detailed approach for the audit's scope, timing, and execution. It ensures the audit is conducted efficiently, effectively, and in compliance with professional standards.
As we move further into the digital age, financial statement audits now heavily rely on advanced technologies like AI and data analytics to enhance the accuracy and efficiency of the audit process.
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