One of the essential components for a business which comes from the side of the entrepreneur is money or funds. Without funds, it is tough even to imagine how a company would survive. To maintain the proper records of the funds going in and out in the cash flow of the business you will have access to accountants, either in-house or outsourced. Nonetheless, if the accountants made a mistake in maintaining the books of accounts the business might have to pay for it. At this point, an auditor comes in to save the day.
Choosing an auditor is one of the most significant decisions which has to be taken by a businessman after setting up a company. These auditors will re-check all the books of the accounts and make sure that all the funds which are circulating in the business are used for the betterment of the company. Any capable and knowledgeable auditor can perform the analysis of the financial books of the company, but we should try to hire such auditors who would understand the mission and vision of the company and would work accordingly. This is the reason for choosing an auditor with the right skills and attitude is so essential for a company. Let’s understand more about an auditor.
How Does an Auditor Function?
The primary function of an auditor is to figure out if the financial data of the company has been presented in a fair and orderly fashion. After checking and re-checking all the necessary documents, the final audit report is prepared by the auditor which states that all the financial statements of the company are correct and are prepared according to the respective accounting and auditing standards. To come to this conclusion, the auditor has to gather evidence, test and compare the findings. The above steps are taken to find out if ay fraud or misstatement has been done in the company books of accounts.
Some of the more important auditing procedures which the auditor must perform include the following:
- Communicating with the management in order to gain an understanding of the organization, its operations, financial reporting, etc.
- Performing analytical procedures on expected or unexpected deviations in account balances or classes of transactions
- Evaluating and understanding the internal control system
- Testing the documents supporting the account balances or classes of transactions
- Confirming accounts receivable and other accounts with a third party
- Observing the physical inventory count
After completing all the above-said processes, an auditor may also provide advice which would help in improving the financial and internal controls of the company so that the company could streamline its process and be more profitable.
What to Look for in an Auditor?
Qualified auditors will share the following characteristics:
1.Experience with an Unblemished Record
The auditor should have sufficient experience related to the domain so that it can provide correct and simplified solutions to the client. The auditor should have the appropriate qualifications and should also be knowledgeable about the related businesses so that he could give simplified and comprehensive advice to the clients.
2.Quick and Correct Decision Making
The auditor should be able to take decisions very quickly and should not be influenced by any entity or any circumstance. All their decisions, reports etc. should be as a result of careful and thoughtful analysis of the company’s data. An auditor must have the ability to take quick and clear decision utilizing the information at hand.
In today’s data-driven world, the provision of security is of paramount importance. The auditors should be trustworthy and should not share the data of the client with any third party. Auditors may come across very sensitive information during the auditing and accounting procedures. These data should be handled very carefully because if the data reaches wrong hands, in that case, the company may face huge problems.
4.Good Communication Skills
An auditor must possess good communication skills along with good people skills. Only being a skilled auditor does not mean anything if you do not have the necessary people skills. If the auditors are unable to communicate about their work effectively, all their efforts will go in vain.
5.Knowledgeable and Professional
An auditor must know about all the procedures of conducting an audit and the various needs of a particular business. A knowledgeable auditor may be able to recognise any possible opportunity in the business environment and then encash them. They should be able to provide practical advice professionally.
The work of an auditor can be complicated and may demand a lot of time and resources, but the above-mentioned qualities can help an auditor to deliver quality work that is not biased or compromised and will also allow the business in question to increase the profitability of the company. If you are looking for a reputable auditing firm in Dubai or a professional CPA in Dubai, then JAXA will be a perfect companion for you. At JAXA, we not only provide Auditing services but also offer various other services such as Auditing, TAX, VAT, Cash flow and Forecasting services and many others. For more details on the services we provide do contact us – we’d be happy to help.