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Audit

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Why is it necessary to conduct audit by the companies?

  • All the companies are required to get their books of accounts audited.
  • On the basis of the audited financial statements of a company decisions are taken by the company’s investor / lenders or creditors.
  • CA/ CPA qualification are required to take the review of the financial statements.
  • The probability of any fraud or financial misapplication in business gets reduced where the audit is performed in an efficient manner.

What are the purpose &aims of Auditing Financial Statements?

Objective: The aim of carrying out the statutory audit of a corporation is to focus on the opinion expressed by the CA / CPA regarding the accuracy and honesty of the financial statements.

Accountability: Financial statements are the main indicators of transparency for the operation of the company and the performance of the enterprise can only be calculated by audited financial statements. The company management shall be liable for the timely filing of the financial statements. Investors shall stress their confidence in the independent opinion issued by the CA / CPA.

Reliability: The audited financial statements give reasonable assurance to its clients that they will have trust in the data, accounting and performance of the company. Tax authorities, banks and venture capital firms also require the efficiency and accuracy of the financial statements along with the investors and business leaders.

Scope: Financial audit is known to provide reasonable assurance as to the reliability, accuracy and justice of the financial statements.

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