As critical as financial statement audits are for companies, organizing and validating copious amounts of financial data can be brutal on the accountants conducting the audit. Hoping to help accountants everywhere strike the perfect balance between automation and skilled work, Audit Sight pulled in new funding to enhance its platform that works to streamline the notoriously complex auditing process.
Atlanta-based Audit Sight secured $4 million in a round of seed+ funding from Hyde Park Venture Partners, and it comes at a time when the company wasn’t actively seeking new capital, according to T.C. Whittaker, Audit Sight’s co-founder and CEO. The platform works to take the monotonous tasks out of an auditor’s day and allow them more time to focus on the things that genuinely rely on a person’s judgment.
“The audit is a very important thing, but it’s a very broken, inefficient process,” Whittaker told Built In. “There are still many places in the audit where we firmly believe that an auditor or a CPA is necessary and needed. We just focus what we’re doing on certain tests of details to say … it might not be necessary for an auditor to vouch [for] an invoice to a cash receipt coming in via the bank, whereas it might be very necessary for an auditor to go and use their judgment on the allowance for doubtful accounts.”
Rather than certified public accountants (CPAs) having to make continual requests for information or manually test details and key in data, Audit Sight’s solution collects a company’s bank, credit card and accounting data and provides CPAs with easy access to everything they need during an audit. Whittaker co-founded the company with Jonathan Womack, Audit Sight’s COO. The solution was created by the two veteran CPAs who have their own experience doing tedious accounting work for companies.
The number of CPAs in the country has been on a steady decline for years. Whittaker recalls conversations with several accounting department heads at a variety of institutions where all of them had mentioned their enrollment and matriculation numbers had all been trending downward. In this era where fewer CPAs are joining the workforce, new technologies have arisen to save precious time and effort for those who are active today.
Since the time of the company’s seed round back in October, Audit Sight has seen rapid growth and adoption of its platform. The company expanded its team to include 12 full-time staff members, and with their help, brought its solution to market and onboarded its first CPA firm customers.
“Growing a business going from zero to one is by far one of the hardest things you do in any business, and in a software business, it becomes even harder because of the amount of work that needs to get done,” Womack told Built In. “Here at Audit Sight … the number one guiding principle we talked about in every company-wide meeting is whatever we build must eliminate work for the auditor ... and what that has allowed us to do is to build a solution that our customers will need.”
Its platform currently encompasses two modules to automate processes such as accounts receivable testing. Next up, Audit Sight is putting its new capital toward building out four new modules for customers for things like revenue testing and searching for unrecorded liabilities. One of these new modules will be released every quarter, according to Womack. It’s also building a new solution to enter a new vertical — the quality of earnings space.
As more businesses are bought and sold, CPAs who perform quality of earnings audits are met with the issue of passing information back and forth with clients as they run tests to assess how a company accumulates its revenues. With companies seeking to close transactions quickly, the timelines for CPAs to complete their assessments are shortened.
While Audit Sight is in the midst of growing into this new vertical, the company is hiring new talent in sales and marketing throughout the year. It’s also increasing its engineering and development resources.
Auditing is an essential part of a business’ integrity since it proves its financial credibility. For instance, the shareholders investing in a company or the banks lending it money can only trust that their finances are in good hands because of the auditing processes that the company has undergone.
“Fraud is a real thing and it still exists today,” Womack said. “Fraud is very destructive, it ruins people’s lives. And here at Audit Sight, as we expand our capabilities, as we’re automating more and more of these auditing tests, we are eliminating fraud from the world. When I look up 10 years from now, I’ll be very happy that Audit Sight prevents this destructive thing from existing in our world.”