Flowcharts are a go-to tool for accountants and auditors.
Accountants use flowcharts to understand and evaluate the business processes
for their clients or companies. Typically, accountants painstakingly interview
employees, write-up what they have learned, and then document the processes
using flowcharts. This process can take a long time with many subsequent
interviews and follow-ups to ensure they have accurately documented the
workflows and receive final approval. Flowcharts allow accountants and auditors
to recognize points at which processes could be improved and ensure processes are designed for the desired output. Without a doubt, flowcharts are
important, but the process described above includes a lot of wasted time. This
is where SmartDraw VP can help.
Since creating and editing flowcharts can be a long and difficult process, utilizing flowchart software can make this process a little less painless.
SmartDraw VP automates the process and allows changes to be made quickly and easily with a click of the
mouse. Accountants can even make and edit flowcharts in real time, which
eliminates the need for a multitude of follow up meetings and emails. While
flowcharts are important to understanding processes, using the following three
visuals in unison is the key to completing your job thoroughly and efficiently.
Org Chart
The first step in an audit is to
select the right employees to interview. Naturally, this means understanding
the company’s organization. While some companies may already have an org chart,
others will just have a list of employees. Lists are not really helpful for understanding the key employees and their role within the company. In order to
quickly understand the company, you will want to create an organization chart or organization charts of particulars divisions within a company.
An organization chart, or org
chart, shows the structure of a company by showing the different levels of
management. It shows the different positions within a company and their direct
subordinates. An org chart has a structure similar to that of a family tree.
The highest authority of the company, such as the CEO, is placed at the top of
the tree and all subordinates branch below that box based on rank. The
exception is assistants such as secretaries, whose boxes are connected to the
branch below the person whom they assist. If you find it helpful you can
include information other than the role and person fulfilling that role, such
as a phone number or email address. Learn more about
some features of building org charts in SmartDraw VP here.
Mind Map
I see several different
applications of mind maps for accountants. First of all, mind maps are a great
project management tool. You can easily outline all your daily, weekly, monthly
action items or outline action items specific to a project. With SmartDraw VP,
mind maps are easily converted into a Gantt chart, which is perfect for project
management. But, mind maps are also especially useful for audits and further
understanding employee roles after you create an org chart.
Each position can be described using
a mind map to define the job functions of employees. This will help define what
processes should be defined with flowcharts. Documenting workflows can easily
be bogged down with unnecessary details, so going into the task with a high
level understanding of what you need will help you avoid unnecessary work.
Flowchart
If you are reading this, I am
pretty sure you know what a flowchart is, but to reiterate, it is a method for
visually documenting and understanding the flow of a system. Flowcharts are
fantastic for describing complex relationships because they reduce the steps to
a simple picture of the system. A flowchart is not only useful for an
accountant or auditor, but it is also useful for orienting new employees,
defining responsibilities, identifying accounting controls, and evaluating the
efficiency of business processes. Flowcharts are very helpful for studying and
evaluating internal accounting controls. They are easier to understand than
several pages of explanations and they are very easy to update. However, all
flowcharts should use a set of standardized symbols to prevent any potential
confusion. The most common symbols used in a flowchart are: (also see flowchart symbols here:
The most common flowcharts used by
auditors are:
While I have only listed three visuals that will help
accountants and auditors, SmartDraw VP also has a variety of visuals that are
great for finance and accounting. In SmartDraw it is easy to find them by
searching for “Finance & Accounting.” You will find templates that we find
to be the most popular for this topic, as well as a variety of visuals for
accounting forms, accounting procedures, bankruptcy, estate planning,
inheritance planning, tax planning, transfer of assets, and trusts. You can also learn more about auditors and flowcharting in this PDF document.
What do you feel is the most valuable visual in
your accounting work? Comment below and share your thoughts!
You can also download the SmartDraw files I used for this post here:
HR Manager Job Map.sdr
Flowchart Symbols and Functions.sdr
Flowcharts Commonly Used By Auditors.sdr
If you don't already own SmartDraw VP, download a trial here.
