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business audit

If I told you I could visit your business and in one day I could look at your financials, oversee your management processes, highlight areas in your business you could do better in, offer solutions to running more efficiently and identify not only any threats that could cost your business big money in the future, but also uncover any employees that might be swindling you and your business, would you be excited? 

Sounds too good to be true, but I promise it’s a service I can deliver. Would you book me if I could help your business in this way? 

What if I told you I was an auditor and your company needs a business audit? 

Would you still book me?

I am guessing, like most people, you probably said yes to the first option and freaked out slightly at the second one. However, the reality is a business audit often has many positive outcomes that you can apply to improve your business.

To most business owners, just the thought of a business audit places them in a state of panic. Questions such as: “Are we paying the right amount of tax?”, “Did we declare any deductions we shouldn’t have?”, “How much super did we pay our employees?”, “Did we lodge our last tax return on time?” run wild in your head, and often we feel that the outcome will be more harmful than positive.

An audit is not only about making sure you have followed your legal obligations as a business owner correctly. It would help if you thought of an audit as a “Business Processes Analysis”. Effectively this is a process performed, by experts, to analyse the systems you have in place to run your business more EFFECTIVELY, EFFICIENTLY and SYSTEMATICALLY.

HOW DOES THE AUDIT PROCESS WORK?

There are most commonly 2 types of company audits: 

  • A Statutory/ External audit and 
  • An Internal audit

The External Audit: Generally, this audit applies to public and large proprietary companies. These companies are required by law to have their financial statements audited.

The purpose of this is to examine a company’s business records, policies and procedures to determine whether the company’s financial statements fairly state its financial position, in all material respects, in accordance with Generally Accepted Accounting Principles (GAAP). 

The Internal Audit: An internal audit is elective. Yes, that’s right, businesses choose to have this audit process on their company.

The purpose of the internal audit is to examine the business’s overall performance and address and identify any areas of risk, inefficient processes, the potential to run the business more effectively, and how to safeguard your business assets.

business audit process

The Hero and the Villain Analogy

Although it may sound menial and somewhat dull on paper, the benefits of a “business processes analysis” (formally known as a business audit) are HUGE! To make it more exciting, I compare our work to that of an undercover detective, where the auditor (me) is the hero and bankruptcy or insolvency is the villain. I look for the crucial evidence that saves your business from disaster.  

  1. A detective like analysis uncovering potential fraud and improving your fraud prevention methods:  Our expertise can find discrepancies caused by human involvement before it’s too late and work with you to create a solution to improve your fraud prevention methods.
  2. Staking out poor accounting protocols: You may not know it, but the methods your staff use to complete tasks may not be the most efficient process. Simple changes in delegations of duty and tasks through education and management from the auditor can save you time and, more importantly, money.
  3. Up to Date Accounting Systems: Do you know if the accounting system you use is the most effective for your business? Do you even use accounting software in your business? Are you maximising your performance by using the most up to date platforms? We know the answer. We can uncover what’s best for your business.
  4. Benchmarking of financial reporting information: We can determine the performance of the business and how well it has performed during the financial year by testing, questioning and evidence acquisition.
  5. Protect your business assets: protection from the evilest villain of all businesses, bankruptcy, is essential. We can make sure all your business assets are safeguarded in the event of misfortune.
  6. Uncovering and managing risks to your business: We will look for potential threats to the wellbeing and future success of your business growth. 

Finding the issues in your business or company that may be holding you back can assist you in growing your business more efficiently and keep you on track for greater success and compliance with the law.

If you think your business could benefit from a business audit, don’t hesitate to contact Bishop Collins Accountants. Our audit team is passionate about assisting you in identifying risks to your business and creating strategies to avoid these risks in the future. Through intelligent insights and innovative solutions, they aim to deliver even greater trust and confidence, helping you unlock opportunities in your business.

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