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Audit / February 22nd 2019

The Benefits of a Financial Audit

The benefits of an audit are always likely to outweigh the cost.   Below are just some of the benefits: Streamline Your Operation A good auditor will really get under the skin of your business.  In carrying out their audit work they are likely to be able to highlight any weaknesses in your accounting processes and internal controls, and suggest key areas where you might improve. By engaging an experienced firm of auditors, you’ll get a fresh perspective on your organisation, giving you constructive feedback on your processes and systems.  This will give you the opportunity to weed out any inefficiencies and implement the relevant fixes to help your business run more smoothly. Here are some key areas where a good auditor could save you time and money and help you increase productivity: Bookkeeping: Maintaining accurate financial records is crucial to the success of any business, big or small. An experienced auditor is likely to uncover systematic discrepancies in your accounting procedures and advise you on best practice. Compliance: By performing a thorough review of your internal controls and accounting policies, an independent auditor will assess and review your regulatory requirements and bring to your attention areas of non-compliance. Fraudulent activity: An external auditor will devise their work with a view of potentially uncovering any fraudulent behaviour, malpractice or mismanagement. Reassure key stakeholders: Independently audited financial statements will demonstrate to stakeholders that the company is following best practice, has strong systems and robust processes. Grow Your Business Having your financial statements audited by external auditors can do much more than just improve your internal controls. The ability to produce independently audited financial statements garners a certain amount of credibility within the marketplace as a whole, demonstrating to clients, suppliers and potential investors that your accounts are free from material errors and malpractice. Here are a few ways in which an outside audit can help you grow your business and achieve your long-term goals: Attract New Investment Opportunities Serious potential investors are likely to carry out a significant level of due diligence.  Ordinarily, audited financial statements will be accepted without further question.  Where a company’s accounts are unaudited then a significant level of due diligence may be required, and potential investors are likely to require warranties against historic financial statements.  Often, investors may also require that investment may not proceed until such time as the audit is complete. Get Credit Lenders will want to review historic financial performance as part of their review.   Having audited financial statements may be a specific criteria for a lender. Attract Major Suppliers Many businesses stand and fall on the quality of their supply line, and as a way of managing cash flow, companies often rely on supplier credit. Before signing off on any deal, suppliers will want assurances that your business is sustainable, your workflow is properly managed, and you have the resources to honour your financial commitments. Along with trade references and a standard credit check, suppliers will usually ask to see your audited financial statements for the previous year. Negotiate Lucrative Exit Strategies Potential acquirers will request your audited financial statements as part of their financial due diligence.  Failure to provide these is most likely to cause concern and delay. Speak to the Professionals Getting your financial statements audited can add real value to your business. It can help you spot weaknesses in your internal controls, improve business processes and boost the public perception of your company. Here, at Wisteria, our experienced, highly skilled audit team can give you the tools you need to take your business to the next level; we’ll advise you on current business trends, help you get investment-ready and optimise your profits. If you have any questions, contact us today.

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