An audit is simply a quality control measure to ensure the accuracy of your financial records.
Many businesses conduct internal self-audits annually to ensure the accuracy of their books. External audits might be required if you’re applying for business certifications, preparing for a merger or acquisition, or due to regulatory requirements.
In general audits are in place to provide assurance that your financial records and tax returns are accurate, complete, and in compliance with accounting standards and relevant regulations.
What exactly is an audit?
A financial audit is an objective examination and evaluation of the financial statements of an organisation to make sure that the financial records are a fair and accurate representation of the transactions they represent. Using checklists and interviews, auditors determine whether a business has its affairs in order and under control, in accordance with relevant standards, requirements, and/or objectives. They then present their findings in an audit report.
But why conduct audits?
The main purpose of an external audit is to validate a company's financial statements and to provide independent assurance of the accuracy of financial reports.
These are the most common reasons for conducting an audit:
An external audit would be necessary in order to verify the reliability of your internal accounting procedures.
What are the 3 main types of audits?
There are three main types of audits: external audits, internal audits, and forensic audits.
What to look out for when choosing an external auditing firm.
Choosing the right external auditing firm is an important decision that can have a significant impact on your business’s financial health, reputation, and compliance with legal and regulatory requirements.
Overall, take the time to carefully evaluate each potential external auditing firm, and select the one that best meets your organization's needs and expectations.
Getting through an external audit is a big project. Access to flexible fractional CFO talent means that a team of other highly qualified finance professionals can help you meet deadlines and crush goals.
We love helping groups compile sets of financials that will pass the standards of any top 10 audit firm.
Getting in extra hands that understand the audit process and can help your team with preparation of audit packs, answering the multitudes of audit queries, and everything else required to get the audit over the line. Plug in Outsourced CFO’s accounting experts with audit backgrounds to help you and your team get this year’s audit done on time. For more information, visit www.ocfo.com