Financial Statement Audit
An audit is basically an in-depth inspection of account books and other financial records of a company. The audit procedure refers to performing the audit and giving suggestions for the betterment of the company that is being audited. Proper financial records should be provided to the auditor with verified proof, so that the auditor understands the current situation of the particular company, this process is very important so that the auditor provides results accurately and complete transparency and give necessary opinions to the company for its betterment. This process is done by a highly qualified independent auditor. The auditor's report must comply with the financial statements and also with the laws and regulations in order to keep away from the legal fines and penalties. In order to take loans a good audit report of financial statements is very essential. The audit procedure is made easier by the use of frameworks like; Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS). An audit is required by the investors, creditors and other users of financial statements of your company, because it provides the uttermost amount of guarantee of a company’s financial statements. The audit is performed by an a 3rd party person, which means the audit is performed by a person who does not belong to the company that is undergoing the audit process. The basic objective of a financial statement audit is providing a sincere and unbiased third-party assurance of a company’s financial statements. The auditor’s expert advice depends on what is shown through the balance sheets, statements of financial position, statement of profit and loss account’s reliability. Confirmation of sales and income is required to show the tax authorities so that they can lend funds for your company with full belief. Even a slight error in the audit report can make a huge difference to a company's position. Resulting in bad effects on the reputation of a company. Some of the basic principles governing a financial statement audit are as follows; Integrity, Objectivity, Independence, Confidentiality, Skill and Competence, Documentation, Planning, Audit Evidence, Accounting System and Internal Control, Audit Conclusions and Report.