Although audits are generally considered stressful events, a lot of valuable information can be gained from these financial exercises. Internal and external audits are performed for a variety of reasons. Both can help pinpoint areas where a small business is lacking in internal controls, operational efficiency or regulatory compliance.
Small businesses can gain a lot from having a better understanding of their financial position. Benefits of regular audits include improved interest rates, increased protection from risk and legal liabilities and access to more capital. A financial review or audit can also give a business owner a better understanding of how their business operates, uses cash and assumes risk.
What is an audit?
An audit is an independent examination of a company’s financial statements. Audits provide assurance to financial stakeholders that the company’s financial statements are free from material errors. Certain types of audits also provide assurance that a company’s policies and procedures are being carried out as intended. Information obtained during an audit can be used to help strengthen and grow the business.
Types of small business audits include:
Why small businesses conduct audits
Due to industry regulations, some small businesses are required to undergo internal and external audits. Sometimes a small business may need to produce a positive audit opinion in order to secure a small business loan. Other reasons for audits include suspected fraud, employee theft, and operating inefficiencies.
A clean audit opinion from a qualified external auditor can help small businesses gain the confidence of investors, customers and business partners.
Burdette Smith & Bish LLC provides professional auditing services for a variety of industries. Our comprehensive financial reporting services provide a clear image of your company’s performance and potential. We perform audits for not-for-profit entities, non-public companies, and retirement plans.
Burdette Smith & Bish LLC can give your business the financial tools it needs to succeed! Please contact us for details.