Understanding the External Audit Benefits

Identifying the challenges that companies are facing in this period of crisis is not easy and having business transparency is critical to facing competition. The credibility of the company's image positively influences the attraction of customers, suppliers, investors or any part that may be interested in the organization's business. However, lack of transparency can make new businesses unfeasible and competitiveness against the market. To stay competitive in this market, you need to have the correct accounting and financial information, seeking the confidence of business stakeholders. And to ensure this transparency in business and increase credibility to third parties, an external audit was critical by an independent firm.

What are the benefits of hiring an external audit?

The hiring of an external audit brings more reliability to accounting and financial records and contributes to the development of corporate governance, promoting knowledge, adjustments and monitoring in the company's activities. In addition, we can cite factors that contribute to better management and decision making:

- More efficient internal controls:

One of the premises of external audit is to know the entity, its business and its internal controls. The flaws identified are communicated by the audit more critically, and the company can work to mitigate them.

- Security in financial information:

An audited company periodically is a positive indication that its information has credibility, as the audit contributes to inhibiting collusion practices, fraud and errors in its operations and records.

- Analysis of financial statements:

Information regarding financial, billing, purchases and other sectors reaches accounting and give rise to accounting records. The auditor will have access to the internal controls used by the company and, through audit procedures, ensures that this information is correctly reflected in the financial statements.

- Obtaining loans:

Audited financial statements bring more credibility and transparency to the company's business, which facilitates the obtaining of resources from financial institutions.

- Investors:

External audit plays a key role in attracting investors. Over the years the audit has been presenting an emphatic concern with technological advances, adaptation of guidelines and compliance with current rules and regulations. These are facts that contribute to give credibility to the company's financial, accounting and operational information, which ensures the confidence of potential investors.

External audit, in addition to evaluating technical and appropriate procedures, has as its final product the issuance of the independent auditors' report on the reliability of the equity position and the result of its operations. It is not only focused on the processes, but also the generation of credibility and confidence in the company's business.

Does your company need an external audit?

Can the benefits presented to contribute to the operations to be more transparent and can help at times of managerial restructuring, loans and search for investors? We believe yes.