BENEFITS OF AUDITING TO BUSINESS

According to Company Law 1965, each and every company (public or private) is compulsory to be audited. It is a process to a business as it goes through of an analysis to determine the business condition. Auditing will be performed once of a financial year by an internal or external auditor.

 Auditing helps to identify the business’s weaknesses in the accounting systems as some errors might occur. It suggest improvements to businesses to perform better in the future too.

Moreover, performing an audit can help to detect any fraudulent activities in the business. Some fraudulent activities that is run by the business might not be obvious to show sometimes but it can be easily found by performing an audit.

Other than the social gaining confident from the product or service of a particular company, having to know that the company’s audit report is being unqualified will help them build more trust and confident to the company as the company is being audited by an professional and independent auditor with GAAS (Generally Accepted Auditing Standard).

Furthermore, the most considerable thing to all the shareholders is the return and the condition of the company. By performing an audit, it can show a true and fair view to the company as to provide assurance to the shareholders about the figures in all the accounts.

Not just that, auditing can detect any risk in the company such as inherent risk, control risk, and detection risk. These risks reflects to the internal control of a company as it is the main core control of how the business is carried out. Hence, the company can correct the mistakes and perform better in the future.

            Performing an audit is a process that is mainly to provide security and assurance of the financial condition to the company in order to make decisions. Thus, the management can use this information to evaluate and measure the necessary to meet their objectives.