Auditing Is A Shielder For A Business Entity
An audit is defined as, “An independent review of the fair dealing by which the financial statements of the company are devised and submitted to its authorities. Also, this is implemented by audit firms or auditors who are trained and experienced persons.” Generally, audits are to access the financial information of an organization or a company, no matter what its nature, size or legal form independently. Also, audit services are provided by independent organizations and firms.
These are of two types audit:
Internal audits are conducted for management review purposes by the employees of the organization and provide suggestions to top management on important issues. For example, the extent risk and how can they be managed. Also, they have a broad scope inside a company unit and cover various areas such as effectiveness of business functions, business reputation, the trustworthiness of financial accountancy, business development, preventing and inspecting fraud activities, to find out whether the operations are falling in line with the norms and different laws.
External audits conducted by audit firm in Pune or people outside the business to provide an objective opinion regarding the financial matter of the company. Auditors provide crucial comments on the capability of the internal control system as well as they plan and perform the audits to make sure that financial statements of the company are prepared as per the law needs.
Why Audit Services Needed
Every business or organization needs to have their financial aspect running in good order. For the smooth running of the financial aspect, they must check out all the different firms, which provide audit services for meeting complex compliance obligations of today. Also, they should make sure if the companies are following particular regulations imposed on their business or not. audit firms conduct research of every activity at all management levels like management control level, operation control level and strategic planning. In addition to this, they also provide various suggestions and recommendations for the development of the company to top management, including board of directors, managing director and managers.
As an owner of business, you have concerns regarding why a company might need audited financial statements. There are some vital reasons why an audit might be useful. For instance, lenders, creditors and investors may need to know the current financial condition of your business / company, so they can make their financial decisions accordingly.