A financial audit is a type of audit that consists of evaluating the economic and accounting management of a company. Subsequently, this study should reflect the true image of it in a report.
Through financial auditing, a company or organization is susceptible to evaluation or analysis. An auditing entity, whether internal or external, reliably observes the economic and accounting documentation.
Therefore, the financial auditor must verify that the results obtained through an accounting audit are valid and useful for an official verification or approval.
Although it is true that this modality is often identified with the accounting audit, the financial audit is formally the continuation of the work of the previous one as supervisory and verification work.
In this sense, their work must be carried out in a synergistic way with other auditing tasks such as management, IT or tax, for example. For this reason, there is talk of another concept such as comprehensive auditing.Audit report
Objectives of the financial audit
The audit conclusions must have a real basis, in which credibility is shown with respect to the actions undertaken by the company. The operation of the same in its day to day exercising its economic activity are valid in accordance with the law.
In other words, economically the organization would operate in a transparent, coherent manner and in accordance with its corresponding standard and legal framework. In other words, it provides credibility to third parties of its annual accounts and its different values and sales figures.
This is that the entire relationship of income and expenses of the company serves so that, in an efficient way, the corresponding business or organizational goals are achieved.
Characteristics of the financial audit
The main mission of this type of audit work resides in the following basic points:
- Review of documentation and economic-accounting operations of the company, through the study of its financial statements, its annual accounts or other types of accounting documents, such as records or various vouchers.
- Verification against the standard. The accounting and economic content evaluated must respect the regulations in force in the territory in which the company operates.
- Reflection of the conclusions in a report. It must have reliability with respect to third parties, such as other companies or institutions and public bodies. In said final report, internal management improvement measures are proposed, as well as essential points to be developed or improved.
The financial audit is also a basic tool when it comes to adapting the economic, financial and accounting structure of an organization to the activity it develops. To do this, it adapts it to a certain existing regulation.
Alternatively, this modality has become over time a useful tool in the business or institutional world. This happens because its performance favors the discovery or the appearance of cases of fraud or management malpractice.Characteristics of the financial statements
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