Audits are the cornerstone of financial reporting and are a statutory requirement for medium sized and large companies and also in certain special circumstances. Through changes in legislation fewer businesses now legally require an audit. However, many audit exempt companies may still benefit from them.
To perform an effective audit we need to get to know your business, the industry in which you operate and the economic factors affecting you. Regular contact with you is a key priority for our team of qualified and experienced audit specialists, including those times when accurate and relevant advice is needed on special plans and projects.
Through your audit we can review the key drivers within your business, your financial controls and management systems, helping you to identify risks, how best to minimise them and providing a valuable tool for decision-making.
An audit also provides independent evidence of the integrity of your accounts, providing reassurance to your customers, suppliers, actual or potential investors, banks and other finance providers and opening the door to future development.
What is a financial audit?
A financial audit is an independent examination of a company’s financial statements and supporting records.
The purpose is to gain assurance that the financial statements have been prepared appropriately and give a reliable picture of the company’s financial position.
At Watson Buckle, our audit work also considers your business, industry, financial controls and systems to help identify potential risks and areas for improvement.
What does an audit involve?
An audit is a structured process designed to obtain sufficient appropriate evidence to support an independent opinion on a company’s financial statements. While the exact approach will vary depending on the size and complexity of the business, a typical audit involves the following stages:
- Understanding your business: Your auditor will start by understanding your business, its operations, industry, accounting systems and the wider economic and regulatory environment in which you operate. This helps identify areas that may present a higher risk of material misstatement.
- Planning the audit: The auditor will assess the risks associated with the financial statements and develop an audit plan setting out the areas that require particular attention and the procedures needed to obtain sufficient appropriate evidence.
- Assessing internal controls: Where relevant, the auditor will consider the systems and controls your business has in place to prevent or identify errors and fraud. This may include reviewing processes for areas such as sales, purchases, payroll, cash and financial reporting.
- Testing financial information: The auditor will carry out procedures to test the information included in the financial statements. Depending on the circumstances, this may involve examining supporting documentation, checking transactions, confirming balances with third parties, performing analytical procedures and testing specific account balances.
- Reviewing the financial statements: The auditor will assess whether the financial statements have been prepared in accordance with the applicable accounting framework and whether the information presented is consistent with the evidence obtained during the audit.
- Completing the audit and reporting: Once the audit work is complete, the auditor will evaluate the evidence obtained and consider whether any further work is required. They will then form an independent audit opinion on the financial statements and issue the auditor’s report.
At Watson Buckle, the audit process starts with understanding your business, the industry in which you operate and the wider economic factors that may affect you.
How long does an audit take?
The timescale varies depending on factors such as the size and complexity of your business, the quality of your accounting records, the effectiveness of your internal controls and the availability of information.
Planning and providing requested information promptly can help avoid unnecessary delays.
Can Watson Buckle help with audits for different industries?
Yes. Our team supports businesses across a range of sectors and keeps up to date with relevant regulatory and industry developments.
Can Watson Buckle help if I am having an audit for the first time?
Yes. We provide guidance for businesses preparing for their first financial audit and recommend starting preparation early, organising documentation and communicating with the audit team throughout the process.
Can Watson Buckle help if I am having an audit for the first time?
Yes. We provide guidance for businesses preparing for their first financial audit and recommend starting preparation early, organising documentation and communicating with the audit team throughout the process.
