Audit
What is an Audit? Well, it is an examination of books of accounts and day to day affairs of a business entity. Audit is done for many purposes primarily to understand how the entity is performing. An audit is generally ordered by Government to ensure that there is no tax evasion and that company’s books of accounts are free of frauds and errors. Audit can be conducted in various ways, that is, either at year end or concurrently at regular intervals. Income tax return and other tax laws make audit mandatory which must be performed by public accountants registered by ACRA.
At AccTrust Assurance PAC, we provide all types of audit services. We have a team of ACRA certified public accountants who can perform all types of audits, be it statutory, internal, concurrent etc. Audit is not only about checking financial data but also includes study of entity’s state of affairs, internal control, role and actions of management and those charged with governance. Audit also inspects whether the entity properly follows all the rules and regulations applicable on it.
We have a team of qualified members who have years of experience in audit. They will work in an organized manner so that your work doesn’t get disrupted. They will maintain utmost confidentiality and will not reveal your state of affairs to anyone. By hiring us you can expect 100% dedicated work. We will follow all the rules and perform audit as per Singapore Standards on Auditing. You can even get to know the efficiency and effectiveness of your internal control system by availing our different services such as business registration, financial analysis and much more.
Statutory audit
Statutory audit is the most important audit as it is legally required to be conducted. There are various statutes, especially tax laws that require an entity, be it government or private, to get their financial statements audited at year end. Statutory audit is an annual audit that is performed once a year, post-end of financial year by an external auditor. In Statutory audit complete financial year’s books of accounts and other financial and non-financial records are scrutinized. Physical verification of inventory and assets is done. Original documents of investments are checked and liabilities are confirmed.
Every small aspect of the financial transaction is checked. It is the auditor’s duty to check whether the financial statements are made as per applicable financial reporting framework. The audit includes checking of truth and fairness of financial statements. As per the rules of ACRA, statutory audit is mandatory for companies
- With an annual turnover of more than $5 million; or
- Whose number of shareholders have exceeded 20; or
- Have corporate entity as a shareholder.
With effect from 1st July, 2015 small companies are exempted from mandatory statutory audit. A small company is a private company that meets at least 2 of the 3 requirements in the current financial year and two years preceding the current financial year. They are:
- Total annual revenue is not more than $10 million
- Number of employees is not more than 50 at any time of the year
- Total assets are not more than $10 million at any time of the year.
If the company is in a group then the above provisions apply to them as well and that too in aggregate.
Internal audit
Internal audit is an audit that is ordered by the management of an entity. This is done to inspect whether everything and everyone is working efficiently or not. It is done to check whether rules made by the management are being properly followed or not. Internal audit is also done to check the efficiency of internal control system. For instance, the rules of a company state that reimbursement of expenses more than $2500 is to be first verified by the manager. The internal auditor will check whether this rule has been properly followed or not. His responsibilities also include finding frauds, if any.
An internal auditor generally audits concurrently, that is during the year at regular intervals. This allows for a much more detailed checking as compared to statutory audit. Internal audit must be encouraged as it provides a better insight into the financial affairs of the company.
Special audit
Special audit is conducted under special circumstances. It can either be ordered by Government or governing body like, management of an entity, industry association, creditors etc. The purpose of the audit is to find information in relation with the special need. For instance, Government forwards a grant to a charitable trust. Now it wants to get the trust audited to see whether it has utilized the particular grant adequately or not.
Audit is essential for gathering information and finding out mistakes. It is nothing more than a routine inspection that enables Governments, shareholders, creditors, lenders, tax authorities and other users of financial statements to rely upon the credibility of financial statement of the entity. To hire us either give us a call at +65 6635 2171 or simply mail us at business@acctrust.com.sg.