Financial Auditing of your company will show Financial stability and can assist you in generating new funds. Our professionals will assist you grow within the market. A financial audit is an independent, objective evaluation of an organization's financial reports and financial reporting processes. The first purpose of financial audits is to offer regulators, investors, directors, and managers reasonable assurance that financial statements are accurate and complete.
Audits became increasingly common because the complexity of the 2 primary accounting frameworks, Generally Accepted Accounting Principles and International Financial Reporting Standards, have increased, and since there has been an ongoing series of disclosures of fraudulent reporting by major companies.
Planning and risk assessment: Involves gaining of the business understanding of the business and business environment during which it operates, and using this information to assess whether there could also be the danger that would impact the financial statements.
Internal control testing: involves the assessment of the effectiveness of an entity’s suite of control, concentrating on such areas as proper authorisation, safeguarding of assets, and therefore the segregation of duties. this will involve an array of tests conducted on a sampling of transactions to work out the degree of control effectiveness.
Substantive procedure: Involves a broad array of the procedure, of which a small sampling is:
Enhances the quality of the business process
An audited financial statement provides a high, but not an absolute level of assurance that’s the amount included in the company’s financial statements and notes to accounts are free from material misstatements.
An unqualified audit report provides the user with an audit opinion which states that financial statements are showing true and fair view in all material aspects and are in accordance with generally accepted accounting principles.
Financial statement audit provides a level of consistency in financial reporting that the user of the financial statements can rely on when analysing different companies and decision making.
Below are the Responsibility for the financial statements-
The management is responsible for maintaining an up to date and proper accounting system and finally to prepare financial statements.
The auditor is responsible for forming and expressing an opinion on the financial statements.
The audit of the financial statement does not relieve the management of its responsibility.
The auditor decides the scope of his audit having regards to;
The requirement of the relevant legislation
The pronouncements of the Institute
Terms of engagement
However, the terms of engagement cannot supersede the pronouncement of the institute or the provisions of relevant legislation.
Basic principles governing a financial statement audit:
Integrity, objectivity and independence.
Skill and competence.
Work performed by others.
Accounting system and internal control.
Audit conclusion and reporting.
Audits are typically scheduled for three months from beginning to end, which includes four weeks of planning, four weeks of fieldwork, and four weeks of compiling the audit reports.
The audit can be conducted internally by employees of the organisation, or externally by an outside firm.
An audit examines your business financial records to verify they are accurate. This is done through a systematic review of your transactions. Audit look at things like your financial statements and accounting books for small business. Auditors write audit reports to detail what they found during the process.
Audit evidence is obtained by the auditor during a financial audit and recorded in audit working papers.
There are four types of audit reports that are issued by auditors on financial statements. Those audit reports include unqualified audit report, qualified audit report, disclaimer audit report, and adverse audit report.
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