Benefits of Auditing your business
Completing an audit shows your company can be trusted and reliable. There are companies in which their reputations build around how well they manage their assets. When a company is doing what they are supposed to, the audit should go off without a hitch. It shows the company is fulfilling necessary responsibilities and obligations.
Auditors works from within your company serving as a watchdog over your company’s integrity and accountability, scrutinising your financial reporting, safeguarding your company against frauds, errors, and risks while providing objective assurance that your entity is following the rules and regulations and standards. By doing so, your company can avoid penalties that will amount up as financial losses.
Some of the benefits of auditing include:
1. Strong internal controls
Internal audits evaluate your internal control activities, which comprise of:
Physical control over assets and records
Proper procedures for Authorization
Independent internal verification
2. Process Efficiency
Internal audits help to identify gaps in your business operations, procedures and your governance processes while providing appropriate recommendations on how to solve the misstatements.
Internal audits review through your business’s cybersecurity environment to check for any vulnerabilities and if they are secured to your security standards. Auditors will provide and recommend on the possible ways to mitigate the issues raised.
Apart from cyber security, physical security is also reviewed on as to how accessible the storage room storing the inventories is. The easier it is to access, the higher the chance of goods and inventory being stolen which is not ideal for the company.
Internal audits analyse and review your financial statements and verify their accuracy and integrity. Especially in recent times, fraud has been increasingly common, hence the need for audit is extremely necessary to avoid financial losses.
5. Reduced risks
Internal audits consider all the identified risks to your enterprise and analyse whether your risk mitigations are strong. Again, your auditor will identify the gaps and report back to you on the potential ways to go about resolving the issues.
6. Improved compliance
Internal audits check the laws, regulations, and industry standards with which your organisation needs to comply and whether the company is adhering to these guidelines. If there are any issues on compliance, your auditor will have to raise an issue and provide suggestions on how to solve them.