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Finance Process Inspection Report [2024]
Auditing a business’s financial statements is not only a technical process but also a key factor in determining the accuracy and reliability of financial information. This is an important step to ensure that the numbers and information that businesses publish are transparent, comply with regulations, and meet accounting and auditing standards.
The audit process is not simply about verifying the accuracy of data but is also placed in the broader context of transparency, the ability to attract investment and build trust from the market. In a competitive and volatile business environment, having a robust and reliable financial audit process plays an undeniable role in the growth of a business. Below, Siglaw would like to introduce to readers the basic process of auditing corporate financial statements so that readers can better visualize financial statement audits.
Concept of auditing financial statements
According to Clause 1, Article 3, Accounting Law 2015, financial reports are the economic and financial information system of the accounting unit, presented according to the form prescribed in accounting standards and accounting regimes.
Financial statement audit is the switch to check and confirm the accuracy and truthfulness of data, accounting documents, and financial reports of accounting units. The purpose of a financial statement audit is to serve those who need to use information in a business’s financial statements. In particular, the system of accounting and auditing standards is the measure to evaluate the audit of financial statements.
Process of auditing financial statements
Auditors need to develop a specific audit process to collect sufficient information to base conclusions on the integrity of financial reports. Each auditing organization will have different processes, but in general, the financial statement auditing process includes 3 steps as follows:
Plan an audit of financial statements
Auditors and companies operating in the audit field regularly develop audit plans, clearly describing the scope of the audit and expected implementation methods. This plan not only indicates and orients the expected scope and approach in the process of auditing financial statements but also serves as a solid basis for implementing the next audit steps.
After that, auditors will conduct surveys, learn deeply about customers, and specifically evaluate the internal control system. At the same time, when planning, auditing companies also ensure the availability of human resources and the capacity to perform financial statement audits accurately and effectively.
Conduct an audit
At this stage, the team of auditors will use their expertise, appropriate auditing methods, and techniques for each specific business to collect accurate information. This process is not simply the active implementation of an audit plan but also includes the development and implementation of dynamic financial plans to provide an assessment of the business’s situation through reporting finances accurately and reasonably.
During this stage, auditors perform control procedures, analysis, and detailed examination of business operations based on the results of the assessment of the client’s internal control system. This will help auditors access information more accurately and objectively to make clear judgments about the reliability and accuracy of corporate financial reports.
Summarize, conclude, and form audit opinions
After completing the analysis and evaluation process, auditors will conclude the financial statements recorded in reports or audit minutes. Before concluding, the auditor or auditing company needs to: verify unexpected debts; evaluate events occurring after the end of the accounting period; and collect explanations from the Board of Directors (if any),…
Finally, the auditors will synthesize the results and prepare a Financial Statement Audit Report. Enterprises can completely accept or not accept the Financial Statement Audit Report.
The financial statement audit process not only ensures the accuracy of financial information but also creates a solid foundation for transparency and reliability in business operations. Auditing is not only a high-tech process but also requires in-depth knowledge and meticulousness in all aspects.
Thanks to the audit process, businesses have the opportunity to self-assess, improve, and optimize internal processes, thereby improving operational performance and competitiveness. Transparency in financial reporting not only helps businesses attract investment but also builds solid trust from shareholders and the market.
Each step in the audit process contributes to determining the accuracy and fairness of financial statements. From planning, collecting information, analyzing, and evaluating to making judgments and conclusions, each step is important and needs to be done carefully.
From the audit process, not only businesses but also the investment community and consumers receive benefits, when receiving assessments and conclusions from experts in the field of audit finance to bring clarity. Transparency and reliability for financial information. This is the foundation for building a healthy and sustainable business environment.
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