By: Oliver Assogna on behalf of Wisteria Accountants
As a business owner, it is important to ensure that your company is growing in the right direction at all times. It is wise to keep an eye on how your organisation is performing on the whole, identifying areas for improvement and setting targets you aim to reach in the near future.
Whether you are in charge of a large- or small-scale company, a business audit will help you stay on track. In fact, it will provide you with the chance to determine if you are investing in the right places and check your business’ overall condition. Not only that, but a comprehensive review of your organisation’s financial statements is also bound to add value to the company.
How? Here, we explore the benefits of having a business audit, specifying the ways in which it monitors and enhances the efficiency of your organisation.
Detects fraudulent activity
One of the main advantages of auditing your business is that you can uncover any potentially fraudulent activity. According to the Association of Certified Fraud Examiners (ACFE), fraud costs businesses all over the globe an estimated $4.5 trillion every year.
By nature, audits are designed to spot misstatements in your financial reports, which in turn can help detect instances of fraud. In companies, this can take place in many different forms, from payroll fraud to employee theft. If you ever happen to discover some illicit activity within the business, an audit accountant will be able to suggest what kind of steps the company should take in response.
However, if everyone inside the business is aware of the fact that you perform regular audits, you could nip the problem in the bud. Indeed, this is likely to prevent fraud from happening in the first place.
Having your business’ financial situation checked from time to time will give you the peace of mind you deserve. The truth is, though, that you will not be the only one to obtain reassurance from an accurate examination of your company.
Verified financial statements will boost the credibility of your organisation in the marketplace. Confident that you are operating in a secure and successful manner, and that your business is regularly monitored, customers are more prone to pick you as their brand of choice.
Paves the way towards funding
Again, business audits project a constant, healthy image of your business. In the eyes of banks or other financial institutions, an organisation with stable and reviewed financial statements is one that can be trusted. Why is this important?
As your company grows, there is a chance that you will find yourself having to raise capital. Audit reports will make the difference when trying to obtain some much-needed loans or funding. Some extra financial resources will offer you the possibility to take your business to the next level – that is, the one it truly deserves.
A business audit, in some ways, can act as a revealing medical appointment. After a careful check-up, you are provided with a general assessment of your company’s state, helping you formulate diagnoses and fixing any existing inefficiencies. In fact, regular audits ensure that both your financial activities and internal operations are effective under any circumstance.
By addressing mishaps within the organisation in a timely fashion, you can improve your business’ productivity and devise how to maximise your profits. You will be able to cut unnecessary steps that are costing you time and money, and overturn practices that are not working as you’d like.
Drives the company’s ambitions
Last but certainly not least, business audits can help you set out your plans for the future. By comparing your financial reports on a fixed basis, you will be able to identify growth opportunities and programme your next targets.
Therefore, auditing your organisation enables you to pursue specific objectives. What are your ambitions? How can you increase the value of your company? With regular, thorough examinations within your business, there is always scope for improvement.
Being in charge of a business comes with its fair share of responsibilities. One of the principal priorities is to find ways to nurture and maintain growth. From signalling fraudulent activity to providing credibility and enhancing productivity, business audits represent a great tool to forward the success and value of your company.