The Future of the Financial Audit
02

Jun 2020

One of the building blocks of any company is the investors, and all the companies required these investors to grow and expand. An investor will invest in a particular company only if he has access to all the information about the company. In the last few years, there is an increase in the demand for transparency among investors. Investors need to make an informed decision and decide what will be adequately rewarded for their investment.

Here is where conducting an Audit of a company comes in. A financial audit of the company not only provides much-needed transparency to the investors but also provides confidence to both the current investor as well as the potential investors. An audit is not only a scrutiny of the financial books of the company but also is a tool to enhance the value and profitability of the company.

Let us have a look at what is a Financial Audit.

Audit: Meaning

An audit is a process in which all the books of accounts of a company are examined. The results of the audit are presented in an audit report which is provided at the end of the audit process. This audit report provides us with various essential and accurate information which will help the potential investors to make informed decisions.

During an audit, all the books of accounts of the company are examined. In some instances, the board of directors is also considered as to how much influence do they have on the decision-making capacity of the company. Once the audit is conducted, the result must be presented in an audit report which will be available to the potential investors.

Technology and Audit

The importance of conducting an audit is known to every business, and it is a continuous effort from the side of the corporates to incorporate new technologies and new methods in the audit process to divulge further and detailed information about the company. Various new changes in the field of audit have taken place, which has enhanced the value of an Audit. Some of the technological advancements are as follows:

●Internet

This is one of the most significant improvements in technology which has made the life of an auditor very simple and easy. The internet was initially developed so that the army of a country could be in constant communication with each other, but the application of the internet has changed the face of the earth in various ways. With its use, it is very easy for the auditor to obtain and gather information about a company.

●Big Data Analytics

Big Data has simplified the analysis process as it deals with gathering data of the entity.  The implementation of Big Data Analytics will not only allow the auditor to understand the current condition of the entity but will also help in charting the trend in the industry.

●Cloud Computing

Cloud Computing is an essential factor in deciding which auditor to choose. Cloud Computing allows a person to access all the stored records from any place on earth. This has opened up a massive area of outsourcing of auditing services.

These are only some of the essential technologies which have helped in changing the face of the industry. Many newer technologies are being implemented in the auditing sector to make this process more accurate and provide new insights that will enhance the working of the business.  An audit is required for the business to understand the present condition of the business, and it also helps the investors to make informed decisions. An audit will also assist in creating a strategy for the future of the business. An audit is a very important tool for a business, and if it is not utilized correctly, then the company may be wasting an excellent opportunity.

If you are looking to avail audit services for your company or are looking at other Bookkeeping and Accounting services, then JAXA Chartered Accountants can help you in this matter. JAXA is a leading financial consulting firm and is the approved auditor for several free zones in the UAE. For more details in the services provided by JAXA Chartered Accountants, Contact Us. We will be glad to help you.