Making the most of an Audit

Some business owners think that their statutory audit is merely a costly legal necessity and do not see the advantages of this annual review.

It is therefore vitally important that the benefits of an audit are fully communicated and understood and that the process is seen as adding value to the business itself, its directors and its shareholders.

The statutory function of an audit is to provide an opinion on the truth and fairness of the financial statements and to state whether they comply with company or charity law. However, a well planned audit will achieve far more.

The PEM audit team has identified the following key benefits of a successful audit:

• Inefficiencies in business processes may be identified
• Helps to deter and detect material fraud and error
• Provides credibility to the published financial information
• Reduces the risk of penalties and fines
• The auditors are able to provide a unique insight into best practice and benchmarking across a range of industries
• Enhances the reputation of an organisation
• An independent audit is crucial to good corporate governance essential to an effective internal financial control function
• Issues highlighted from the audit will assist the directors/owners to run the business more successfully.

The conclusion of the findings is that a successful audit will fulfill both the legal requirement and be of benefit to the business. If the benefits are highlighted then the audit process will be valued much more highly and play a major part in helping the business become more successful.

The audit should not be defined by its statutory requirement but rather by the benefit it provides. Audit services are best provided by those with the relevant skills and experience.

The PEM specialist audit team is well placed to tailor audit work to the specific needs of our clients.

For further information and advice call Roger Webster on 01223 728222 or email rwebster@pem.co.uk