The financial statements of any business enterprise, irrespective of its size and nature of business, hold maximum significance. Therefore, these documents need to be scrutinized and assessed elaborately. That's where the need for internal and external audits arises.
It is essential to undertake financial audits in an objective and unbiased way. The job of auditing is to be ensured with the help of qualified finance professionals who check the monetary transactions and confirm the accuracy of the financial position of a business.
An audit is either done internally by employees of the organization or by external auditing agencies.
Internal Auditing
Internal auditing is done by companies regularly. These audits are performed by a group of finance and account professionals who are employees of the company and make up the audit department of the organization. Auditors understand the business environment and the company's accounting policies and business strategies.
Internal auditing helps to increase the overall efficiency of the business. The auditors evaluate the company process in a precise and systematic manner. Moreover, it helps reduce risks in business operations. They also ensure that the organization ensures regulatory compliances and pay their taxes on time. Having an internal audit process enables the company to face external auditors.
Internal Audit – Procedure
The procedure followed by internal auditors varies according to the organization's requirements. Though there is no standard format, a common practice followed by internal auditors in the UAE include the following:
External Auditing
External auditors perform the external auditing exercise with precision. The auditors get selected by the Board of directors and shareholders. External auditors are answerable to the shareholders and the regulatory authorities. Hence, they conduct the audit in an unbiased manner. Hence, these auditors conclude their report on the current financial position of the company. For all registered companies in the UAE, an external Audit is mandatory.
External auditing has relevance in the UAE as they ensure that IFRS and GAAP financial accounting are complied with.
Since the external auditors are not employees of the organization, they are under no pressure to oblige anyone or work under restrictions. As they are certified finance professionals, their report is precise and accurate, considered valid, and carries a lot of weight with the regulatory authorities, shareholders, financial institutions, banks, and investors.
External auditors look out for financial irregularities and suggest corrective measures to weigh the management.
External Audit – Procedure
Absher Audit Services
Absher Consultancy provides a range of Audit Services in Dubai. Their turnkey of services includes internal and external auditing for all business organizations, whether big or small. The consultancy has a core team of experienced professionals who carry out the audit exercise diligently and accurately. Their scope of work includes
Absher Consultancy services go beyond the regular financial analysis and audit. The experts assess deficiency in the company's process and ensure that the management takes their audit report seriously. Hence, these professionals ensure the exact remedial measures.