The audit is the examination and verification of the company’s financial records. The main purpose is to ensure financial information must be accurate and fair. Audit and accounting services play a role in banks to ensure the financial statements in the bank are
According To The Standards
The professional form audit company checks the income statement, balance sheet, and cash flow statement. In the banks, these service providers thoroughly review the data and confirm the financial statement provided by the banks.
Preparation Of Financial Statement
The service provider works by preparing the financial statement by utilization of the accounting standards like international financial reporting standards. Audit and accounting services provide information to different users like shareholders, government entities, suppliers, customers, creditors, and partners.
Importance Of Financial Statements
Financial statements are important as they capture the investment, operational and financial-related activities of the companies by means of the recorded transactions. These are developed internally. There is a risk of fraud behavior by the preparator of the statements. Therefore, banks require the financial audit service provider to ensure the companies have a financial position according to a statement provided by the finance department. The service provider ensures that statement is accurate and according to accounting standards.
The financial statement is checked according to the types of audits going on. There are three main types. These are discussed below.
Internal Audits
The employees of the organization do internal audits. These are not distributed outside the company, and management prepared itself to make decisions and prepare for the use of internal stakeholders. This ensures compliance with regulations and laws for maintaining fair, accurate, and timely financial reporting.
External Audits
The audit and accounting service perform the external audit to create an unbiased opinion and confirm that financial audits are according to the statement. They are utilized to determine any material misstatement or any kind of error in the bank’s financial statement. In case of the statement is wrong, the audit provides the confidence that the financial statement is mitigated and provided with accuracy and completeness.
Government Audits
Audit and account service work for the government also. These are performed to ensure the financial statements are papered with accuracy, and there is no malpresentation of the amount of taxable income for the bank. Different audit services perform this task. For the sample in the US, internal revenue services do audits of banks and other companies to ensure the accuracy of the taxpayer’s tax return and transactions.
Final Verdict
Audit and accounting services are important for banks to keep a check and balance the financial statement. After the audit is performed, the professional stamp the document so there is no tax return. After the audit, change has to be accepted by the taxpayer and documentation of points for which the taxpayer does not accept changes. In case if taxpayer or bank doesn’t accept the audit statement, then the issue is taken to legal bodies for mediation or appeal.
