Each entrepreneur should clearly understand what audit is and why it is needed. Audit activity is a set of measures aimed at conducting a thorough check of the correctness of the preparation and maintenance of accounting and financial, tax reporting of an economic entity. To the company that has passed such an audit, the tax service is more loyal.
Answering the question of what audit is, I want to note that this is an independent and reliable audit that can improve the image of the company or keep it at the same level. An individual entrepreneur or a special audit organization that has received an appropriate license can carry out this activity. A specialist must meet a number of requirements and have an economic education. An audit of business entities not only ascertains the reliability of the financial statements, but also reveals errors or distortions in the accounting. In addition, the auditor develops specific measures to improve the efficiency of accounting at the enterprise.
Most often, the company conducts a financial audit, which involves the study of financial statements for reliability and accuracy. This type of check can be internal or external. The first is carried out by the forces of the economic entity itself, for this a special department is created that is engaged only in audit. The external type of verification is carried out by special organizations that have received a license to provide a specific list of services. The activities of private auditors and entire firms are regulated by government bodies and are based on individual laws and regulations.
The purpose of any audit is to express the opinion of a specialist on the quality and reliability of the accounting department and internal control system. Therefore, at the end of the allotted for the study of all the intricacies of the term, the auditor must issue an opinion. Moreover, the result may be different from absolutely positive if significant distortions or errors were found in the enterprise’s work that the economic entity subsequently did not correct. The head of the company may not agree with the results and require a second review, but in any case, he must pay for the services of the auditor in full.
Everyone should understand what audit is and what its essence is, since it can also be carried out in a forced manner. Some business entities are subject to mandatory checks based on the criteria of the current legislation. This type of audit is payable, otherwise the audit firm has the right to sue, and the amount established by bilateral agreement of the parties is forcibly transferred from the account of the enterprise in the bank serving it.
Recently, audit of quality has gained particular popularity. It involves the study of all aspects of the enterprise, its basic strategic approach and the identification of the effectiveness of this program. For this purpose, the results of the company’s activities for a specific period of time are studied, competitiveness, and the demand for its products on the market are considered. In addition, the specialist makes a conclusion about the possibility of applying the chosen strategic position in the future, the likely result that the company will receive at the end of the reporting period is also evaluated.
The legal entity should understand what audit is and what goals it pursues. Since this is just an expression of the opinion of an audit firm specialist on the reliability of financial statements and the reliability of internal control, rather than a statement of fact. There are also various kinds of violations, distortions or errors in the work of the auditor, therefore, disagreement with his opinion can be expressed in the statement of claim.