What Do You Understand By Financial Auditing Of A Company?

Good-Guy

VIP Contributor
There are many major companies around the world. There are many businesses of various sizes and when it comes to finance, it is quite natural to think that managing and conducting auditing of a larger company might be really difficult. The easiest definition of auditing is that the term "Auditing" refers to financial analysis, recording, and accounting of a company. Auditing could be done every month or every year depending on the financial system of the company. Moreover, the huge business organizations consists of much bigger financial operations and this is the main reason why they might require a group of auditors to carry out the auditing process, as a single auditor might not be able to handle this process in a better way.

A team of auditor consists of accountants who work for the company. The final auditing report might be reviewed by the directors of the company and a detailed financial analysis might be presented in the meeting of the directors in order to have a review of the performance of the company in the fiscal year. So this was my review of what auditing actually is. What are your thoughts about auditing? Please present your views. Thanks!
 
D

Deleted member 28127

Guest
This is because the company can do not know many tricks or falsely are managing systems and finances then an external audit can, for example, let them discover if there is a fault or something like that from specialists and experts.
 

Mellorando

Banned
Possibly at the end of every year the financial records of the business needs to be audited by special directives therefore,
An audit refers to an examination of the financial statements of a company. Audits are conducted to provide investors and other stakeholders with confidence that a company's financial reports are accurate. Companies do auditing because, Audits provide valuable information about a business. Many times, businesses will conduct audits to determine areas of their business that could benefit from improvement. ... A financial audit helps business owners understand how their business operates, uses money, and assumes risk.
The audit can be conducted internally by employees of the organization or externally by an outside Certified Public Accountant firm.The objective of an audit is to form an independent opinion on the financial statements of the audited entity. The opinion includes whether the financial statements show a true and fair view, and have been properly prepared in accordance with accounting standards.
Finally, auditing helps in the detection and prevention of errors and frauds. The audit helps in maintaining the records and verification of books of the books of accounts. The independent opinion of the auditor is extracted through auditing which is extremely essential for the management of the company.

Below are the various steps of auditing a company:

*Steps to do an Audit Process of a
Company:

1 You should be Clear about Your
Mission.
2 Evaluate Your Mission.
3 Identify Potential Errors.
4 Develop a Strategy.
5 Inform the Organization.
6 Check All the Outgoing Payment
Validity.
7 Keep a Check on All the Company
Deposits.
8 Review all Financial Statements.
 
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