Beginner’s Guide to Choosing the Best Audit Services in Singapore
The audit is part of a company’s measure to ensure that its accounting records are accurate and represent what actually occurred during the period. Additionally, it is also a means to discover company misappropriations and fraud.
Primarily, you need an audit service provider because that state requires the mandatory audit of financial statements and accounting records. But more importantly, choosing the best audit services in Singapore is crucial because it gives your company credibility and confidence- that your accounts are true and fair.
You can think of the audit service provider as a partner in setting your business up for success. To reach this goal, you need to find a partner who has integrity, competence, skills, and experience. You will work with your chosen auditor year after year, so you need to choose the audit firm which will make the process more convenient for you without compromising the quality of work done.
Do you need audit services but don’t know where to start looking? We have gathered and outlined here the top 10 best audit services in Singapore for your convenience! This article also provides a brief overview of the information you need about audit services- what audit services are and why you need it.
What Is Audit Services?
Audit services are professional services rendered by external auditors. The company hires an external auditor to review and audit the company’s financial records. This procedure is done because the Singapore Companies Act requires every company to have its financial statements and accounting records audited annually unless the company meets the qualifications for audit exemption.
During an audit, the auditors review the accuracy of the financial statement and records. For example, the auditors do an inventory count to check whether the number of physical stocks matches the number depicted in the records. They also trace the supporting documents for transactions with significant values, look for discrepancies and check whether the event really occurred or was only falsified.
Further, audit services also reveal whether the company follows the standards for financial reporting. These reporting standards are sets of rules that set out how companies classify, measure the value, and present the transactions that occurred during the accounting period. These standards allow for the uniformity of the financial reports, so that company financials may easily be understood and compared to benchmarks. The conduct of audit reinforces this goal by reviewing how the company classified, measured, and presented its accounts.
Why Do You Need Audit Services?
The agency problem is the primary reason why we conduct audit services. This usually happens in large companies having separate owner and management functions. Large companies usually hire a corporate service provider to oversee business operations, strategize plans to increase sales, and maximize profits. In this setup, the company owners are the principals and the service provider is the management team or the agent that ensures the achievement of the principal’s goals.
The agency problem happens when the agent acts unfavorably when presented with an incentive. For example, a manager may be motivated to falsify increasing sales to receive a bonus for reaching a sales quota. The records would then show a satisfactory revenue when in reality the company is really struggling. What the manager did was not in alignment with the company owner’s goals.
Requiring external audits gives a checking mechanism to prevent the consequences of the agency problem. The external auditor acts as an independent party that examines financial records for fairness. It keeps the management from perpetrating misdeeds, misappropriations, and fraud knowing that there is someone to review the company records.
This is why it is important to choose only the best audit services in Singapore. You need a knowledgeable, experienced, and competent audit service provider to see through concealing activities and discover improper asset and records management.
Where Should I Find the Best Audit Services?
Your main concern when choosing audit services is whether associating with such a firm will add credibility to your company. To know this, you have to make sure the audit firm has a good reputation and looks good on paper. Further, you also have to consider whether the audit firm is compatible with your company type.
Is the audit firm certified to offer audit services and acknowledged by appropriate audit authorities? Will work with them allow you to reach your goals, given your company type, size, and business needs? These are only a few questions you need to consider when looking for the best audit services in Singapore. Look over these qualifications in the top 10 best audit services in Singapore.