They help sort your tax, and a good accountant will support you making strategic financial decisions as well.
So does your business need an auditor as well?
The answer might surprise you.
An audit provides a valuable insight into your company’s operations that can identify opportunities and the holes in your business. This allows your team to focus on building the business and growing your profits.
A growing number of companies are legally obliged to be audited, with a recent crackdown by the Australian Securities and Investments Commission, or ASIC, on Proprietary Limited company audits catching many businesses out.
If your business is a public company, a large proprietary company, a foreign-owned small proprietary company, a registered scheme or a disclosing entity, chances are you could get stung if you do not prepare and lodge audited financial statements.
However, audits can also be valuable for purposes other than statutory obligations and can provide tangible and meaningful benefits for business.
Here are four important things an audit can do for your bottom line:
- Provide an independent and commercially sound view of performance - An audit can offer valuable insights into accounting practices and can validate the processes being carried out. The independent evaluation adds integrity and credibility for stakeholders.
- Enhance overall corporate governance processes - A company audit can provide transparency for stakeholders such as a separate management team, silent partners, board members, shareholders or the minority interest.
- Identify risk management benefits - By identifying instances where internal controls are inadequate, an audit can limit a business’ exposure to losses as a result of mismanagement. This includes any non-compliance with applicable laws and regulations that the company may be unaware of.
- Recognise opportunities for improved business - Improving the consistency and reliability of financial information provides decision makers with a level of confidence and enables them to make meaningful decisions for the company’s future, such as where to invest further time, money and resources to provide further growth and profitability.
Still unsure if an audit is appropriate for your business?
An audit isn’t always the most appropriate approach. Other types of assurance engagements might be better suited to your company and provide you with the desired result for a fraction of the cost. These include:
- The preparation of a Due Diligence Report on key areas within a business;
- Agreed-upon procedures for the assigned auditor to only focus on specific areas of the business; and
- A Review Engagement, which is less in depth than an audit but still provides a level of assurance over the financial information of the business.
Should you wish to discuss the services our Advisory and Assurance team can provide — or discuss the type of assurance engagement of benefit to your business — get in touch with us. Not only can we assist in meeting your statutory obligations, we can provide your business with a value-adding service that can ultimately improve your business’ processes and operations.