ERP Audit Consultant, Canada

Where an ERP audit ends and your accountants' work begins

Canadian companies already deal with one kind of audit: the engagement your CPA firm performs on the financial statements, whether that is a full audit, a review engagement or a compilation. Those engagements follow professional standards and lead to a formal report. An ERP audit is something else entirely, and it should never be described to a bank or an investor as if it were the same thing.

The ERP audit I carry out is an operational review commissioned by management. It examines the system that produces your numbers rather than the numbers themselves:

• whether configuration still matches how each entity and province operates;
• how tax, currency, payroll and banking data reach the ledger;
• who can do what, and whether risky combinations of access exist;
• where spreadsheets and manual journals fill gaps;
• which reports can be trusted without adjustment.

Accounting framework questions, such as how something should be presented under ASPE or IFRS, stay with your accountant. Where a finding touches tax or accounting treatment, I write it as a question with evidence attached so the right professional can answer it quickly. For the general approach, see my ERP health check service; the rest of this page covers what changes for a Canadian business.

Checking GST/HST, PST and QST setup

Canada's layered sales taxes make configuration errors easy to introduce and hard to spot. A customer moves province, a new product line has a different tax status, or the business begins selling into a province that levies its own sales tax, and the defaults in the ERP quietly stop matching reality.

The review follows tax through the system with real transactions rather than settings alone. I sample invoices to customers in different provinces, including shipments where the ship-to address differs from the bill-to address, and record what the system charged. On the purchase side, I look at how recoverable tax is tracked, whether non-recoverable provincial tax is being expensed or capitalized as intended, and how imports are handled.

Quebec deserves separate attention. QST is administered by Revenu Québec, and businesses selling there often have reporting that runs in parallel with their federal returns. I check whether the system produces the figures for each return directly or whether someone rebuilds them in a spreadsheet each period.

None of this is tax advice. Each observation records what the system does, the transactions affected and the question your accountant needs to answer, such as whether a particular item is zero-rated or exempt. Corrections to past filings, if any are needed, are decided by your accountant.

USD activity, payroll and bank files

Buying from US suppliers, selling to US customers and holding a USD bank account each add steps that are easy to get slightly wrong. The review checks how foreign currency transactions are recorded, whether revaluation runs at period-end inside the system or as a manual journal, and whether realized and unrealized exchange differences land in the accounts your accountant expects. For imported stock, I look at how duties, brokerage and freight reach item costs. If multi-currency is a wider issue, the page on ERP for multi-currency goes into design options.

Payroll is usually run by a specialist provider, with the ERP receiving a journal. I check the mapping by department and project, and whether payroll liabilities and remittances reconcile to the balance sheet. The provider remains responsible for payroll calculations and year-end slips.

Banking connections get the same scrutiny: EFT payment files, pre-authorized debits, bank statement imports and reconciliation rules. Ecommerce, CRM and shipping connectors are logged too, each with an owner, an alerting method, if any, and the manual fallback staff use when it stops. The spreadsheet inventory that sits alongside shows where people have stepped in to cover gaps. Deeper work on connections is covered under ERP integration.

Access controls, privacy and data quality

In a growing Canadian company, access rights tend to follow people rather than roles. Someone covers accounts payable during a vacancy and keeps the access; a former consultant's account stays active; a warehouse team shares one login. The review lists these cases by name and looks specifically at risky combinations: creating vendors and approving their payments, changing bank details and releasing EFT files, posting and approving journals, and adjusting inventory without review.

Where the finance team is too small to separate every duty, I suggest compensating checks your controller can run, such as a regular report of vendor master changes or manual journals.

Privacy matters too. Federal privacy law applies to many private-sector businesses, and some provinces, Quebec in particular, have their own rules. The ERP may hold employee records, customer contacts and notes containing personal information. I map which screens and attachments hold personal data and which roles can download it in bulk, and leave the legal assessment to your privacy officer or lawyer.

Finally, data quality: duplicate customers created for each province, items with inconsistent units or missing costs, stale open orders and control accounts that disagree with their subledgers. Each issue is sized and ranked by its effect on the reports leadership uses, because cleaning data in the wrong order rarely improves the figures that matter.

Reports, licenses and what happens after the review

The last part of the review tests the reports leadership and lenders rely on: sales and margin by province, inventory valuation, receivables aging in both currencies and the monthly management pack. Each key figure is traced to the ledger. Reports that need manual adjustment each month are listed with the reason. I also compare license types and counts with actual usage, because unused or misallocated licenses are a cost that is simple to recover at renewal.

The findings report opens with a summary for leadership, followed by detailed findings rated for impact and effort and labeled with an owner. A readout session lets your team challenge any conclusion before the report is final.

What comes next follows from the evidence. Where the platform is fine but under-adopted, the usual answer is ERP optimization. If an unfinished project or a difficult go-live is the real issue, my ERP rescue consultant page for Canada explains the recovery route.

I carry out the review remotely, booking live sessions to suit head office and using recordings so staff from Atlantic to Pacific time can contribute. The engagement runs in English; any French content is reviewed by your team or a local partner. On-site visits are possible by arrangement. Wider advisory help for Canadian firms is listed under Canadian ERP consulting, with market notes on the Canada hub.