A financial statement audit involves performing a detailed evaluation of a company’s financial records. Regular financial statement audits are essential to every business – particularly those that are undergoing rapid growth – when it comes to tax planning, legal compliance, and the ability to develop an accurate budget. However, sifting through countless mountains of paperwork can undoubtedly put you behind schedule when you are trying to manage a business. While there are many reasons why your business may need a financial statement audit, the Roseville financial statement auditors at Cook CPA Group have narrowed the list down to the four of the most important. To learn more about our financial audit services in a free consultation, contact Cook CPA Group today.
4 Reasons Your Business Needs a Financial Statement Audit
A financial statement audit is mostly a report made by an external financial statement auditor concerning your company’s finances. While the definition on its own may not seem like much, the analysis, work and final assessment of your business’ finances are critical to your day-to-day operations and decisions moving forward. Some of the reasons why you may need a financial statement audit include, but are not limited to the following:
- Facilitating business operations
- Improving your company’s credibility and reputation
- Detecting and stopping fraud – before it can escalate further
- Identifying opportunities for growth and expansion
Improving Your Operations
Running and keeping a business afloat in today’s economy requires a high level of focus and control. While some business owners have a management background and experience with finances, many others might not have the same luck. If you don’t have enough financial expertise, or no experience at all, obtaining internal audit services is in your company’s best interests.
It’s understandable that business owners want their finances to be in top condition, to make new investments, and ultimately, make their business grow. However, business growth and development requires having funds – and further, having an accurate, comprehensive picture of how those funds are being allocated. A financial statement audit allows business owners to see the bigger picture. An accurate report will let you make better decisions for improving your business’ operations and future development.
Improving Your Reputation and Credibility
Whether you are trying to get a new business loan, are attempting to sell the business, or would like to take the company in a different direction, virtually every financial decision you make is ultimately tied to your financial statement audit. For instance, imagine that you are trying to sell your company. Any buyer interested in acquiring your company will likely require you to present your financial statement in order to confirm that its finances are stable enough to make the purchase worthwhile.
The same principle applies to companies that are requesting a business loan. Any financial institution will likely require a financial statement audit to make sure that granting the loan would not constitute a major risk.
Detecting and Neutralizing Fraudulent Activity
Running a business and analyzing your finances can be an overwhelming task. Paying attention to every detail of your daily operations while sifting through hundreds of documents can affect your company negatively. With so many tasks at hand, discovering possible fraud – and neutralizing it swiftly – can be difficult for business owners.
A financial statement audit will allow you to have a detailed report on your finances. Having accurate information about every business decision over a set period places you in a better position for identifying whether fraud has occurred, and if so, when and to what extent. Tying into the point above, a financial statement audit can help you boost your credibility with stakeholders and investors, demonstrating that your company is managing its funds vigilantly and appropriately.
Expanding your Business
Growth and profitability should be among the top focuses of any company. As your business expands and adds more branches or employees, so does the need for tight financial controls and efficient decision-making. A financial statement audit can help you determine the best courses of financial action to help your business continue its growth. If you are thinking about expanding your business, then you may need an audit that lets you know where your company stands financially – and where it can be improved.
Roseville, CA Auditing Services for Businesses
Running a successful business requires having control its of day-to-day operations and, just as critically, its finances. A financial statement auditor can help you have a better understanding of your company’s spending habits, operational costs, and overall financial condition, empowering you to reach your professional goals. To learn more about our accounting and bookkeeping services and how we can help you regain control of your business’ finances, call Cook CPA Group today at (916) 724-1665, or contact our Roseville CPA firm online for a free consultation.