Auditing is among the most critical functions of a company’s financial department. Most companies keep the auditing function within the company by having an internal auditor. However, it is also highly advisable to have an external auditor. An external auditor is an independent audit company, and they provide unbiased reviews of your organization’s financial records.
While you may assume that your organization’s financial controls and records are accurate, it is essential to get an external auditor’s report to confirm it. You can contract an audit or accounting company to conduct the financial analysis. You can quickly get an audit company in Malaysia to review your organization’s financial records.
Benefits of hiring an external auditor
Hiring an audit company offers many advantages, including:
- Identification of errors
A small business or organization may not able to employ an accountant to keep financial records. And even where the business owner has the financial expertise to conduct audits, the responsibilities of running the business can prevent them from committing enough time to identify errors and omissions in the financial records. Contracting an external auditor helps to identify these errors and correct them. It provides a business or organization with more explicit business data and records.
- More credibility
An external audit review is deemed more credible because of it lacks bias, unlike an internal one. People get a sense of truthfulness and transparency when they know that a professional company created your company’s audit report. It is essential to demonstrate that your company has nothing to hide. It is also highly advisable to have a company secretary in Malaysia because it helps you win the trust and confidence of the public and the authorities.
- Evaluate internal control
An external auditor will conduct a thorough review of your company’s financial processes and transactions. They will verify whether your company’s approvals and authority checks are adequate and all transactions are reflected in the financial records. The audit company will also evaluate the effectiveness and efficiency of your computer systems. The audit company will advise you on how to address any shortcomings.
- Audited financial statements
Banks and other financial institutions will demand that you furnish them with the audited financial reports when applying for loans or letters of credit. The accounts are accepted as an accurate picture of your company’s financial health and value. Tax authorities are also likely to take the audited financial statements as the basis for calculating your income or sales taxes.
- Goodwill
Customers are increasingly taking an interest in the affairs of business organizations. Hiring an audit company shows you are a transparent business person and that you are responsible for your actions. The audited financial statements may also help to defuse disagreements among partners. You can use the reports to demonstrate that you settle accounts.
- Preventing fraud
Having an external auditor can also help to prevent employees from committing fraud. Studies show that the awareness of an external auditor can be an effective fraud deterrent.
