What Is an Audit?
An audit is like a financial checkup, conducted to see if everything is in place and all the records match. Records in an audit represent the transactions your business has been making, be it spending or earning.
The audit can be conducted internally or externally by using audit services Singapore. The internal audit is conducted by someone within the organization whereas an external audit is conducted by an external audit services provider, like an accounting firm.
External audits are usually considered more credible and reliable for two reasons. The first is that they are conducted by a third party that is neutral and is only focused on doing its job properly. Secondly, external audit services providers use proper mechanisms, abide by the professional rules, maintain standards, and adhere to modern requirements.
Audit services Singapore are also accepted by other institutions like revenue boards of the government where internal audits do not stand credible.
In this blog, we will discuss some of the benefits of regular audits and why every SME in Singapore should get one.
Benefits of Regular Audits:
1. Staying Informed:
In order for an external auditor, you need to produce your records in front of him. It means to show receipts, invoices, statements, etc.
Taking out all these records and then matching them for audit makes you more informed by your business as auditors generate a detailed audit report for you.
This report represents your spending and earnings, your profits and loss.
Overall, an audit can make you more informed about your business in a smart and comprehensive way. It gives a digestible report on things that you would otherwise have forgotten as your daily transactions.
2. Staying Clean:
Regular audits rule out any discrepancies in your records as they examine all of your records. Doing this makes the financial environment of your SME clean for you so that you can see through it and understand what is actually happening in your company and how your business is performing.
SMEs in Singapore usually have a lot of transactions going on every day and the situation can become really messy, keeping the decision-makers from making effective decisions.
An audit is a great way to clean up all that mess and start seeing clearly.
3. Staying In Control:
To stay in control of your business, you need to know exactly what is coming and going out of your business. Since an audit provides you with valuable financial insights, you will be in a better position to stay in control of your business.
You can revaluate your strategies and decide which ones are bringing in results, which ones are worth it, and which ones should be discarded for a positive response. You can also see what opportunities your SME has and which are the areas that need more investment.
Similarly, you can take control of the areas that were making you bear losses.
Moreover, you can also track any discrepancies that you find in the audit and see where things are going wrong and handle any mismanagement on your or your staff’s part.
4. Making Informed Decisions:
Getting regular audit services will not only help you with revaluating your existing business strategies and plans, but it can also help you take effective and informed decisions for your business.
With better controls over your business, you will be able to make future strategies smartly. You will be able to cut down on things that are burdening your business and boost things that will help you in the future. It will give you a clearer perspective of your business goals.
Once you have your goals clear, you will be in a better position to think of new partnerships, products, services, or facilities that can help your business grow.
5. Accurate Tax Returns:
Audit services Singapore do not only provide internal business benefits, but they also help you on an external level, especially when it is time to file your tax returns.
If you are vigilant regarding paying your taxes, that is great. But you should never be paying more than what is due on you. In order for you to know what is due to you, you need to know the exact financial standings of your business.
You should know what accounts like profit and loss as per the rule book and what benefits you can get from being in a particular category. The more ambiguity you have in your finances, the more likely you are to pay more or less of the due amount. The former will cost you your money and the latter will make you a criminal so it is a lose-lose situation for you.
To avoid such things, you should also be vigilant to conduct your audit.
6. Staying Off the Radar:
If you do not care about your financial discrepancies, the government will. Financial discrepancies will not only harm your business internally, but they can also get in trouble with the government.
If you do not get your audit conducted yourself, chances are high that the government’s revenue department will. If your records are not well maintained, you are very much likely to have some problems with your tax returns and once they come on the radar, you might not get any benefit of the doubt.
Regular audits can help you stay off this radar because they will clear out any financial discrepancies before you file your returns. If something still does not sit right with the government, you can present them with your external audit services report and it should be sufficient to justify your position in front of them.
If even that does not work, you will at least have all your financial records sorted that you will be able to produce in front of them right on the spot that they can examine to cross-check your returns and give you a clean chit.
Conclusion:
Regular audit services Singapore is just as healthy and necessary for your business as regular medical checkups are for you. It keeps everything monitored, sorted, and well under check.
It helps in the timely diagnosis of any underlying problems and enables you to take better steps for good. And it also saves you from a bigger problem than you could have faced.
