Audit Trail in Construction – Purpose, Advantages and How to Improve It
Audit Trail in Construction – Purpose, Advantages and How to Improve It

Audit Trail in Construction – Purpose, Advantages and How to Improve It


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A general principle in business management is that well-handled audit trails are primary indicators of good internal business controls. Every industry needs an audit trail – from logistics to healthcare, high-tech, financial, energy, and even construction firms. As a construction business owner, it is no doubt that you need immutable and secure records of whether and when a certain transaction was performed precisely. Because having a well-recorded audit trail helps your company understand your business’s state, both past and present.

But what is an audit trail? And why should you manage it properly? This blog will define what an audit trail is, its primary purpose, its benefits to your construction business, and what you can do to best improve it.

What is an Audit Trail?


An audit trail in construction is the time-stamped and date, sequential records of the details and history around a work event, project development phase, business transaction, etc. Different fields usually have audit trails that exist in various forms to capture their distinctive focus areas. However, audit trails’ overarching purpose and the theme is to track the sequence of actions and events in chronological order. 

Specific to the construction industry, an audit trail is a list of records that tracks access to every aspect of the business. It can help to uncover and review more detailed information on trades, especially when there are some questions regarding the integrity and validity of construction data. 

Audit trails are proven to be beneficial to your business overall. However, it can be complicated to build. But why are they so complicated to design and develop? It is all because the overall development requires a lot of moving parts, like the below: 

  • Security of the data
  • Where to store the data
  • Messaging between the applications containing the data to pass information back and forth and to the database.
  • A search engine right on top of data is essential since users may find the data valuable. Thus, they should have the ability to search and retrieve it.
  • The obtained data should be visualized so users can draw some insights from the data.

However, you may end up spending a lot of time establishing audit trails that are somewhat inconsistent in quality. You, your team, and the rest of the parties that will use audit trails may not be satisfied because the basic process is not functional. This is why it is crucial to integrate construction scheduling software into your audit trail process to track and monitor the entire process clearly. 

What are the Advantages of an Audit Trail?


Regulatory Requirements in this sector are enough to prioritize the significance of having a secure audit trail for your construction business. More than that, having audit logs showcases the professionalism of your company which deeply shows control, compliance, and a streamlined audit process. Having a solid and secure audit trail is crucial to maintaining a successful construction business in the industry where your company belongs.

Here are some of the many benefits of maintaining audit trails:

1. Fraud Prevention

Audit trails help your business better control what is truly happening in your company internally. The record-keeping of the audit trails quickly flags any inconsistencies within your business. By simply having an audit trail put off internal fraud, as you and your employees will know, it will be uncovered quickly.

2. Stress-free Audits

Depending on how your company will take it, it is often required to have a dependable, third-party to conduct the audit once a year. The stress of that audit can be tremendously reduced by keeping accurate records. If all transactions have audit trails, especially in inventory, you can easily determine if those transactions are valid. 

For instance, preparing for a detailed construction inventory list helps you create a streamlined approach. It is one of the innovative practices you can now implement within your construction business aside from conducting internal audits. Moreover, everybody should have an easily accessible and detailed audit trail. It is always better to remember that “Good audit trails make for good audits.”

3. Increased Efficiency

The audit trails that are accessible and comprehensive can be examined easily, saving your business money and time and even increasing overall efficiency. The records help you and your team to find a bulk of information. For instance, if you need to look for a particular inventory transaction but only have a little info about it, the exact data with an audit trail can help you discover all of the information surrounding that transaction.

Audit trails can genuinely help you track everything surrounding any form of transaction. It is proven. And with all construction techs emerging today, you should begin realizing the importance of deploying it to your business and integrating it into your processes, especially on your audit trails. Pro Crew Schedule, a subcontractor scheduling software, can help you access information within seconds. Your audit log records are secured, and vital documents cannot be lost.

And so, it only shows that all possible corrections can be captured thru this and the people involved. In return, it saves your business time and effort, with lesser modifications and alterations required. It’s a win-win for both parties!

4. Disaster Recovery

What is an audit trail again? In various ways, especially in the case of unanticipated disaster or crisis, an audit trail is somewhat like insurance. You might not need to run to everyday operations, but you’ll still get relief from audit trails when something unexpected happens. Audit trails served as a reliable record of your overall business activities, expenses, costs, inventory, ROI, etc. 

So, having a reliable audit trail helps you recover from what might consider a company-killing crisis. So until the end, ensure that your audit trail has been backed up off-site.

5. Better positioned to secure loans and investments

Almost all of today’s investors do their due diligence whenever evaluating a company. So, by showing off and presenting your accurate records, your company reveals adequate internal controls that can help in building trust with potential investors. In addition, it also increases your construction company’s overall value.

This is also similarly true when your company wants a loan, or a non-profit applies for a grant. Having comprehensive audit logs and records demonstrates effective due diligence, which assures any investors in the industry.

How an Audit Trail Typically Works


Before giving you a solid example, it is crucial to note that audit trials should begin with a source document. This can be a receipt, an invoice, a purchase request, a voucher, etc. Someone from your team should input and store this information directly to a system. 

There are now a few steps to follow detailing the transaction process. Every transaction can look different, too. Take note of that. It usually depends on how you start the said transaction and how many steps are to complete it. 

An audit trail will look something like this in construction:


Your team member A voiced the need for new construction materials for a new project. First, someone creates a purchase order and has made sure to input it accurately. After purchasing the new materials, someone has to check the inventory list, ensuring that these newly purchased materials are entered into the cloud-based system. A supplier will provide the bill detailing the said purchase transaction. The documents and any communications related to the said purchase are a significant part of the transaction’s audit trail.


If there is an issue with the said transaction, you suspect a crew member of deceiving your company; you can retrace the steps and check back over the orders.

Thanks to audit trails and online inventory software, you and your team can anytime trace such changes.

Ready to Improve Your Overall Audit Trail Process?


Again, what is the audit trail to your construction business? It can mean many things like guarding against fraud, finding new areas to improve, protecting your company from a protracted auditing process, etc. You need audit trails to get the correct data and access it easily when necessary, as they serve as a standard operating procedure for your construction business. 

Suppose you are ready to improve your company’s audit trail process further. In that case, Pro Crew Schedule, the best construction inventory management software, can streamline all of your workflows and processes by simplifying documentation, automating administrative tasks, eliminating inventory issues, and increasing overall transparency with your team members.

Get started with Pro Crew Schedule today! Enjoy a 30-day FREE trial!

Key Takeaways


It is crucial for construction businesses to keep and maintain a complete and comprehensive audit trail to easily track any inconsistencies and find process failures if and when they happen. Make sure you have a secure and solid audit trail process, as it is critical in maintaining the success of your operations and overall business.

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