The Importance of Auditing

  Auditing is a means of evaluating the effectiveness of a company's internal controls. Maintaining an effective system of internal controls is vital for achieving a company's business objectives, obtaining reliable financial reporting on its operations, preventing fraud and misappropriation of its assets, and minimizing its cost of capital. In view of the auditor's report, investors may invest and banks may loan cash. If you aren't intimidated by numbers and you've developed a flair for working with financial transactions, along with being intrigued by investigating financial results, auditing may be a viable career choice for you.

  Academics have started identifying an "Audit Society" .Since, auditing has become an ubiquitous phenomenon in the corporate as well as the public sector. It is an individual that perceives and recognizes the propositions before them for examination. Auditor obtains evidence and formulates an opinion on the basis of his judgement which is communicated through their audit report.

  Third party assurance is given by the auditors on each topic. There are numerous different territories which are usually evaluated, for example, Secretarial and Compliance Audit, Internal Controls, Quality Management, Project Management, Water Management, and Energy Conservation.

  In case for small business owners, the thought of a financial audit is formality. The financial position and organization of a business can be revealed by auditor. Through this, small businesses can get colossal advantages from better understanding their financial position. Financial audits are also beneficial in highlighting areas of success or concern in a business and help the management team find greater pathways to future success.

  Audit is nothing but an independent and systematic examination of statutory records, books of accounts, documents and vouchers of an organization. This mainly performed or conducted to ascertain how far the financial statements as well as non-financial disclosures present a true and fair view of the concern. Audit is an activity that attempts to ensure that the books of accounts are properly maintained by the concern as required by law.

Published by : Ooi Bao Yi

Reference Link : 

"The Importance of Auditors", by Julie Davoren.

"The Importance of an Audit System to Companies", by Jeff Clements, On June 29, 2018