How To Prepare For an Audit
Introduction: Don’t Treat Audit as an Event
Most organizations only think about audit readiness when the email arrives announcing one. But an audit shouldn’t be a fire drill. The most resilient organizations approach it as a continuous check of their existing control program and not a scramble to prove compliance.
At CipherNorth, we help clients shift from reactive to proactive by focusing on five practical steps that any organization, whether regulated or not, can apply to improve audit preparedness.
1. Define Clear Policies and Standards
Policies define what you expect. Standards define how you meet those expectations.
If your policies are too vague, you’ll struggle to hold anyone accountable. Too detailed, and you’ll spend your time managing exceptions instead of enforcing intent.
A balanced example:
Policy: All customer data must be encrypted at rest and in transit.
Standard: TLS 1.2 or higher must be used for all HTTPS traffic.
That distinction matters. Policies should be short, principle-driven, and written in plain language. Standards are the technical and procedural interpretation of those policies. The goal is to create consistency, not bureaucracy.
2. Determine and Document Your Scope
Auditors test against what you say you do. If your policy or standard states “all HTTPS traffic,” an auditor may select random samples from all network segments to verify TLS 1.2 compliance.
If one of those samples fails, it’s not necessarily a “finding” but it will trigger a question. If you’ve defined your exception process, documented ownership, and are tracking deviations yourself, you can respond confidently.
Your scope statement should answer:
What systems, data, or processes are covered?
Who owns them?
What exceptions are allowed and how are they reviewed?
3. Define What’s Out of Scope and Why
Declaring something “out of scope” doesn’t make it disappear. It shifts responsibility.
Maybe you have an IoT environment that’s not under your control. You can exclude it from formal audit testing or from the standard requirement, but you must show that you’ve assessed the risk, justified the exclusion, and implemented compensating controls at least to the point of the risk appetite.
A strong “out of scope” statement anticipates the auditor’s follow-up:
“We exclude IoT devices from encryption standards due to manufacturer limitations. These devices are segmented, monitored, and restricted from sensitive data flows.”
4. Measure, Automate, and Alert
You can’t manage what you don’t measure. For every policy and standard, define metrics that prove compliance:
Total and Percentage of systems meeting TLS standards - this should map back to your scope
Number of open exceptions - this should map to both your scope and your exception process
Time to remediate deviations
Automate as much as possible. Tools that continuously scan for noncompliance (like a web server using HTTP instead of HTTPS) give you early warning. Bonus points if you can tie these alerts to ownership and response SLAs.
Automation doesn’t replace governance it enforces it. Auditors and GRC functions need to move away from one time, manual review of systems to automated, API drive continuous monitoring.
5. Revisit and Right-Size At Least Annually
Environments evolve. Technologies change. So should your program. At least once a year, review:
Are your policies still relevant?
Is your scope still correct?
Have risks shifted enough to justify new controls?
Right-sizing isn’t about lowering standards; it’s about ensuring your audit program reflects your current business, not last year’s version. Some programs need more TLC such as incident response related programs, but once a year is a healthy minimum.
Responding to Audits the Right Way
Preparation is half the battle. The other half is how you respond when the questions arrive.
Centralize responses. Funnel all answers through one or two designated contacts to maintain consistent messaging.
Be factual and concise. Never speculate, and don’t speak to future plans. “We’re planning to…” often creates new audit scope you didn’t intend.
Use documentation rather than stream of consciousness. A strong response includes the auditor’s question, your narrative answer, and quantitative evidence (metrics, screenshots, reports).
Leverage automation. Where possible, provide system-generated proof rather than manually collected samples.
Above all: never lie, and never overpromise. A well-written, measured response builds trust and trust is often the difference between a “note” and a “finding.”
Closing: Building a Culture of Continuous Readiness
Audit preparedness is not about fear, it’s about control. By defining, measuring, and continuously refining your standards, you turn compliance into a predictable process instead of a last-minute scramble.
At CipherNorth, we help organizations operationalize these principles; so when the next audit comes, you’re not reacting, you’re confirming. Reach out if you want help preparing for an audit or exam.