Friday, September 27, 2013

Get To Know Who Should Carry Out Financial Audits

By Paulette Short

Financial audits involve a review of company's books of accounts to ensure that they are real representatives of the company's position. There are two main branches of audits. These include the external and the internal audit. An auditor who is an employee of the company carries internal audit. On the other hand, the external auditor is fully independent. He or she is not an employee of the company. In other words, external auditor is not answerable to the management of the company.

A public company cannot operate without having an auditor to ascertain the correctness of the books of the company. Although hiring an auditor acts as additional cost to the company, a company cannot survive without such an auditor. This is because; the company cannot publish its books unless qualified auditor ascertains them.

As much you may do your best to ensure that you employ reliable employees, you need to ensure that you hire an auditor to ensure that they ascertain that the auditor verifies the validity of the statements presented by the company accountants. Again, an auditor is able to notice any error or fraud committed by the accountants in the process of statement preparation.

Every company requires having reliable investors. No investor can agree to invest his or her money in a company's share, unless the company present correctly audited accounts. This is because; auditor act as shareholders watchdog. They are on the look out to ensure that the company presents the right information. Otherwise, the company may present the wrong information with an aim of having more shareholders.

The books of every company are prepared as far the requirement of the company's act. This means that the persons preparing the books must be conversant with the generally accepted rules. The auditor ensures that the books are in line with the company's act. Apart, from preparing the books of accounts, the auditor also offers sound advice to the managers and directors of the company.

There are different auditors that you can hire. However, not all auditors are able to offer you quality services. Cases of auditors disqualified from the professional board due to fraud are not new. However, with the right research in place, you can easily hire the right auditor. To ensure that you hire the right auditor, you need to evaluate certain factors. For instance, you need to ensure that the right professional body registers the auditor.

The other thing that you need to consider is the experience of the auditor. This is because; the auditor may have the right academic qualification. However, lack of experience will make the auditor under perform. You can know if the auditor is experienced by getting in touch with the clients he or she has dealt with

Sometimes, finding the best auditor to carry out financial audits may not be easy. However, you can start by talking to your relatives and friends. This is because; these individuals may have information on how you can get a reliable auditor. You may also search through the internet.

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