An internal audit is a review of the operations and management control in an organization. It is carried out by an internal auditors from an audit firm who is trained to conduct an examination on the working of a company. The International Standards for the Professional Practice of Internal Auditing (IIA) govern how auditors worldwide conduct internal audit.
An organization enjoys various benefits from seeking the help of an audit firm. The main advantages are as follows:
- Limits errors in the financial records of an organization.
An audit firm can provide a qualified internal auditor to examine the financial statements such as the books of accounts to ensure accuracy and compliance with the Generally Accepted Accounting Principles (GAAP). The auditor may also provide professional advice on improving the operations of a company, which can result in helping the organization in achieving goals and an increase in profits. The auditor verifies the correctness of the financial records presented to the management of an organization.
- Provides credibility to financial records
As Farahat and co explained by recruiting an audit firm, the internal auditor’s services can keep the investors at ease by assuring the financial information provided to them is accurate and compliant with the financial standards. This increases the confidence among investors and money lenders that consider investing money as the organization is reliable.
- Helps maintain an effective control and management system of an organization
An audit firm offers internal auditors that seek to increase the effectiveness in the management of an organization. This is done by providing advice on scope of improvement and identifying any weaknesses that exist within the company or in the operations of the company. This advice helps the management to get a better insight into the working of the organization and can amend certain operations for better results. An internal auditor can also check the performance of staff in the organization, that results in increasing the company’s efficiency. An auditor in Dubai can provide advice on improving the company’s policies and ensuring the staff within the organization complies with these policies.
- Provides risk management to reduce risk of fraud in an organization.
The process of internal auditing detects and prevents risks that could result in fraud. An internal auditor carries out investigations within the business activities to evaluate any potential or risk of fraud. This process is done through a risk assessment, that helps an internal auditor to identify any errors or frauds within an organization. After evaluations, the auditor may provide suggestions to address fraud and prevent it in the future. The auditor may also carry out unexpected checks to ensure effective controls and early detection to prevent any fraud.
- Helps ensure the financial statements are in accordance with the set standards.
An internal auditing firm can review the financial statements of an organization to ensure they are according to the Generally Accepted Accounting Practices (GAAP) and International Financial Reporting Standards (IFRS). After evaluation, the auditor may also provide suggestions for improvement, especially in areas that require an expert’s insight.
- Can detect unnecessary expenditure and helps optimize use of resources
A company can limit the unnecessary expenditure as per the advice provided by an internal auditor. An auditor can identify the misuse of resources and suggest preventive methods to reduce unnecessary expenses in the organization. The internal auditor can improve internal control and the use of resources in the organization. By improving the internal control, the auditor can provide clarity on the resources that are being wasted within the organization. This process helps the company to become cost-efficient.
- An auditor is experienced and up to date with the latest amendments and laws in UAE
One of the benefits of hiring an audit firm is that the internal auditor is experienced and professionally qualified to conduct the evaluations and provide suggestions for improvement in an organization. Auditors keep themselves updated with the new amendments to the governing standards and the laws that prevail in UAE for accounting and auditing. The critical analysis provided by an internal auditor promotes a streamlined process to improve the business activities within the company.
An internal auditor provides various benefits to an organization operating in the UAE. offers a wide range of auditing services to ensure optimal management results in an organization. The firm also checks the accuracy of financial statements and limits errors and fraud within the organization.