A lot of companies are going through their business’ everyday life without second thoughts sometimes. It is good that everything is going smoothly but checking the organization’s internal well-being is advisable before the authorities do so.
This is why there is an internal or external audit and a basic accounting audit that can be done internally by a company in order to ensure that they are complying with the laws and their own regulations.
In the United Arab Emirates, there are accounting Firms in Dubai and in other parts of the country that organizations can get in contact with for them to be more efficient in accounting audit. More often, the accounting & payroll outsourcing services in Dubai have auditors that help out companies to understand more about auditing.
Accounting Audit Defined in Simple Terms
Accounting audit is performed for the higher ups of the company to be sure that they are indeed in compliance with their own rules and the laws. It is important that what is written and showed in the financial statements are true and accurate. The operations of the company are also assessed in an accounting audit. Essentially and ideally, the company should be operating as the way it is planned.
With this audit, everything is checked, ensuring that the financial reporting is up to par wit the accounting standards. Solutions are then discussed for the areas that need to be improved in the company in terms of the financial and accounting side of things.
Accounting audit can be done internally or externally depending on the situations and the preferences of the company itself.
Basic Accounting Auditing
When doing basic accounting auditing, an auditor, internally or externally, can do the following things to be more efficient:
- Be familiar with the standards By reading and following the company standards and their procedures with regard to accounting, it is easier to pinpoint the things that they are not taking heed of. Cross checking everything to be sure is a good way to ensure their compliance as well.
- Be familiar with the international accounting standards There are international accounting standards that accounts follow in doing the financial statements of their company. When you are well versed with regard to it, you can spot in what area they are missing out and such.
- Examine the documents meticulously It is imperative that an auditor has an eye for details. A standard observation should be maintained during an audit as you wouldn’t want to miss out on a potential improvement that should be made in one area because you are being out of focused.
- Record observations and make suggestions/solutions. One of the main purposes of an auditor is to provide the necessary steps for the company to improve. The solutions that are supposed to answer the problems of the company lie on the hands of the auditor. Therefore, the recommendations should be the best ones for the company to improve their system in accounting or their procedures in doing things.
- Present a report for everyone. Once you have done all of the steps above, a report should be made to be presented to the directors or the higher ups of the company. This is when you will tell them what you have observed and what can be done to have efficient and effective accounting systems for better financial records and statements.
FAR – Farhat Office & Co. that holds accounting Services in Dubai and accounting & payroll outsourcing services in Dubai has more information regarding accounting audit and would gladly answer your questions if you have any.