Under the section 122 of the Company ordinance (Cap.622) of the Laws of Hong Kong, the annual financial statements of Hong Kong limited company should be audited by Hong Kong Certified Public Accountants (Practising). Most of Small-Medium Enterprise in Hong Kong, they would like to ask for the auditing services to deal with Inland Revenue Department or Banks Facilities requirement. Actually, the benefits of auditing on the Company go far beyond this.
Observably, the audit purpose is met for the statutory requirements and regulations in your industry. When the Company cannot comply the requirement and regulation, the non-compliance issue will raise out the risk of incurring fines, loss of customers and a tarnished reputation. Most of the damage is far outweighs any audit cost and any minimal, temporary inconvenience.
A thorough, in-depth audit takes an impartial look at your organisation’s internal systems and controls. This means it’s an ideal opportunity for the auditing experts to suggest improvements that can make your business more efficient. Suggesting some ways improve internal controls, business systems, accounting practises, efficiencies, governance and culture can all be identified through the audit process.
An audit will provide independent verification on the financial statements as a true and fair representation to the entity. Audit will provide invaluable credibility and confidence to your organisation’s customers/clients, stakeholders, investors or lenders and even potential buyers.
In New Zealand, New Zealand businesses are subject to fraud, error and corruption up to 30% . Workplace suspected or fraud can occur for some years without being detected. It leads some businesses never recover financially or repair their reputations. An audit can be an effective tool for identifying fraud and opportunities to commit fraud. Experienced auditors are skilled at pinpointing weaknesses in an organisation’s systems and controls and suggesting ways to strengthen these to prevent fraud occurring.
An audit confirms the accuracy of an organisation’s financial statements by analysing its financial performance. It is a professional process and result in certain types of income, expenditure, assets and liabilities being scrutinised. Through the critical examination and the auditor’s expertise can then be used by business owners for better financial planning, budgeting and financial decision-making for the future.