The use of VDRs in the audit process allows simplifying the whole procedure in a number of ways. Moreover, data rooms give a chance to reduce the time and expenses invested in the management of vital documents. In such a way, the role of online repositories in the audit process cannot be overestimated.
Role of Data Rooms in the Audit Process
Data rooms in auditing are used for the following purposes:
- Easy exchange of documents. Data rooms offer a simpler and safer way to keep data organized and exchange documents in a smooth and stress-free way. You will not only get a chance to compile a record of user activity but will also be able to conveniently share documents with all the participants. During the audit process, multiple documents need to be posted, shared via e-mail and couriered. But with data rooms, the need for all this vanishes;
- Enhanced communication. Just because most data rooms offer a Q&A option, you will no longer need to face any queries regarding various important documents. The users will just post their questions about the respective documents online for future reviewing. The responses can be obtained easily and conveniently, and the need to answer the same questions over and over again will disappear;
- Tracking of documentation. In the process of audit, it is important to monitor the progress of this procedure. In this respect, the data room audit provides an easy way to keep all materials organized. Besides, they also give users a chance to send warnings whenever such a need arises. For example, alerts can be sent when a new file is uploaded or when a response to some request is generated. What’s even more important, you won’t have to waste your time and financial resources by traveling to your customer’s premises;
- Improved security. You no longer have to worry that any auditing files can get stolen or lost. Data rooms offer a high level of security by providing a full set of safety features to ensure that all documents remain confidential. The security features range from the restriction of access to certain users to establishing permissions as for who can view and edit files. In this manner, the whole audit process will be carried out in a safer way;
- Compliance with auditing demands guaranteed. VDRs give auditors a chance to make the audit process more transparent by providing thorough reports as for when the requests were made and who viewed them together with other critical details.
In this way, the major goal of data rooms in the audit process is to simplify this procedure and streamline the business processes as well as eradicate unnecessary difficulties and reduce costs considerably.
How Data Rooms Are Used in Auditing
As mentioned earlier, the costs and resources contributed to handling sensitive files are greatly reduced through the use of data rooms. This is achieved by means of the following:
- Ability to exchange documents;
- Enhanced communication;
- Ease of tracking;
- Top-level security.
Financial audits are an essential part of the business process, and they are necessary for the majority of modern-day companies. The audit process is also among the most time-consuming procedures existing in the business world, and, therefore, it requires a special approach. In this respect, data rooms allow simplifying the entire procedure and improving its efficiency in general. That’s why the use of data rooms in audits is essential for most companies working in different spheres.
How Data Security Is Maintained Throughout the Audit Process
Digital repositories in the process of audit allow the participants to track user activity, view and download records, see who has viewed the files, see comments for the board members, investors and auditors and perform many other tasks that are aimed at simplifying the entire process. All this requires enhanced security to guarantee that all files are shared in a safe manner. Luckily, data rooms give the audit participants such an opportunity. That’s because the major function of any virtual warehouse is to guarantee that the documentation kept inside it is shared quickly and safely.
During the audit, this issue is especially crucial because all files uploaded to an online repository are very sensitive and should be kept confidential. Therefore, to guarantee complete data protection, different VDR providers equip their platforms with a whole range of tools that are supposed to reduce the risk of data leakage and eradicate other hazards. Files may contain special watermarks with the name of a user who has viewed and downloaded a particular document. Besides, a timestamp can be added to the file in order to make sure that no malware causes harm to the documents. Regulation of user access and strict authentication process are also some of the safety features offered by VDR providers.
In this way, the use of data rooms during auditing is vital because it allows keeping all sensitive files safe and greatly simplifies the whole procedure.