What is an audit?

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An audit is an independent, objective examination and evaluation of financial statements, records, operations, internal controls, and compliance with laws and regulations. It is performed by trained professionals called auditors for Audit firms in Singapore.

 

The purpose of an audit is to provide reasonable assurance that an organization's financial statements are free of material misstatement and reasonably present the true financial position, results of operations, and cash flows of the organization. In addition, an audit can help an organization identify weaknesses in internal controls and compliance with laws and regulations.

 

Audits are conducted in accordance with generally accepted auditing standards (GAAS), which set forth the requirements for conducting an audit. These standards include guidelines on planning an audit, identifying and assessing risks, designing and performing audit procedures, and evaluating and communicating audit results.

 

There are different types of audits that can be performed, depending on the needs of the organization. For example, a financial statement audit is conducted to provide assurance that an organization's financial statements are fairly presented in accordance with generally accepted accounting principles (GAAP). An operational audit is conducted to assess an organization's efficiency and effectiveness in carrying out its operations. A compliance audit is conducted to evaluate an organization's compliance with laws and regulations.

 

Audits are conducted by independent auditors who are not employed by the organization being audited. The auditor expresses an opinion on the fairness of the financial statements and compliance with laws and regulations based on his or her examination.

 

The auditor's report is addressed to the organization's board of directors and management. It contains the auditor's opinion, as well as any recommendations for improving the organization's financial statements, internal controls, or compliance with laws and regulations.

 

Audits are an important part of an organization's risk management process. They provide a systematic and independent assessment of the organization's financial statements, records, operations, internal controls, and compliance with laws and regulations. By conducts audits on a regular basis, organizations can identify weaknesses in their systems and procedures, and take corrective action to prevent future problems.

 

Why do you need audit?

 

There are a number of reasons why you might need an audit. For example, you may be required to have an audit by law or regulation, or your lender may require an audit as a condition of lending money to your organization. In addition, your board of directors or shareholders may request an audit in order to obtain assurance that the organization's financial statements are accurate and free of material misstatement.

 

An audit can also be helpful in identifying weaknesses in internal controls and compliance with laws and regulations. By conducting an audit on a regular basis, organizations can take corrective action to prevent future problems.

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At Koh Management, we have partners with many Affordable Singapore Small audit firms for SMEs that can assist you with your Singapore Audit Services needs. Singapore Auditors with many years of experience to ensure high quality of audit and assurance work done by qualified Certified Public Accountants (CPAs) of Singapore.

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If you require an audit service done for your business due to statutory needs or prefer to do it due to requirements from your business associates, you can speak to us of your business requirements so that we can advice and assist you in your business needs. Remember Koh Management is there to assist you through out your business journey. CPA Audit Services Singapore at your service.

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Speak to us to be connected to a Certified Public Accountant (CPA) today for your SME Audit Singapore.

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CALL +65 98638665 if you need a quote or Email Tommyksh@shkoh.com.sg

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Frequently Asked Questions

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1. What is the purpose of an audit?
 

• Answer: The main goal of an audit is to verify that the financial statements are accurate and comply with the relevant financial reporting standards, ensuring they are free from significant misstatements.
   

2. Who needs to be audited?

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• Answer: All Singapore-incorporated companies are required to undergo an audit, although there are exemptions available for small companies that meet specific criteria.
  
  We also carry out audit for the following purposes:

  • Statutory Audit

  • Maintenance Fund & MCST Audit

  • Charity Audit

  • Gross Sales Audit (usually by shopping malls)

  • Grant Audit

  • BCA Audit
    
     

3. What is the audit process?

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• Answer: The audit involves several stages, including planning, conducting fieldwork, and finalizing the audit. During this process, the auditor evaluates the company’s internal controls, performs detailed testing, and ultimately forms an opinion on the accuracy of the financial statements.
   

4. How long does an audit take?

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• Answer: The time required for an audit varies based on the company’s size and the complexity of its operations, ranging from a few weeks to several months.
   

5. How much does an audit cost?

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• Answer: Audit fees depend on various factors, including the company’s size, complexity, and the extent of work required. It is advisable to discuss the fees directly with your auditor from the Singapore audit firm you intend to engage. We aim to be provide affordable audit services for Singapore SME companies. 
   

6. What is the auditor’s responsibility?

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• Answer: Auditors are tasked with providing an opinion on the financial statements and ensuring compliance with relevant ethical standards.
   

7. What is management’s responsibility?

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• Answer: The company’s management is responsible for preparing the financial statements accurately and ensuring robust internal controls are in place.
   

8. Can I change my auditor?

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• Answer: Changing auditors is possible, but it requires adherence to specific procedures and approval from the company’s shareholders.
   

9. What is the difference between an audit and a review?

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• Answer: While an audit provides a comprehensive examination of the financial statements and a high level of assurance, a review is less extensive, offering a moderate level of assurance.
   

10. What is a Statutory Audit?

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•  A statutory audit is a legally required review of the accuracy of a company's or government's financial records. The key purpose of a statutory audit is to determine whether an organization is providing a fair and accurate representation of its financial position by examining information such as bank balances, bookkeeping records, and financial transactions.

• A statutory audit is usually conducted by an independent auditor or an auditing firm that is not affiliated with the company being audited. This independence is crucial to ensure an unbiased and objective examination of the financial records.

• The scope and nature of a statutory audit can vary significantly but generally includes:

  • Verification of Financial Statements: Ensuring that the financial statements such as the balance sheet, income statement, and cash flow statement are accurate and complete.

  • Assessment of Accounting Systems and Internal Controls: Evaluating the effectiveness of the organization's internal controls and accounting processes.

  • Compliance with Accounting Standards: Checking whether the company complies with the relevant accounting standards.

  • Legal Compliance: Ensuring that the company is compliant with the legal and regulatory requirements applicable to its financial and operational practices.

  • Reporting: Providing a report or opinion on the financial statements. This report can be unqualified (clean), qualified (having certain reservations), or adverse (if the financial statements are found to be misleading). 

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11. What is a Grant Audit?

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In the context of business and industry development grants in Singapore, such as the Productivity Solutions Grant (PSG) or the Enterprise Development Grant (EDG), a "Grant Audit" refers to the process of reviewing and verifying that the funds received from the grant are used appropriately and in accordance with the grant's terms and conditions. This type of audit is crucial to ensure accountability and proper utilization of public funds.
 

Here's a more detailed look at what a Grant Audit involves:
 

• Purpose of the Audit: The primary purpose of a grant audit is to ensure that the grant recipient has used the funds for the intended purposes as outlined in the grant agreement. This involves verifying that the expenses claimed are eligible, necessary, and reasonable for the project or business improvement for which the grant was awarded.

• Compliance with Grant Terms: The audit checks for compliance with the specific terms and conditions of the grant. This includes adhering to the project scope, timelines, budget allocations, and any other requirements set by the grant-giving body.

• Financial Reporting and Documentation: The grant recipient is usually required to maintain accurate and detailed records of how the grant money is spent. The audit involves examining these financial records, receipts, and any other documentation that supports the expenditure.

• Outcome and Performance Measurement: In some cases, especially for grants aimed at business growth or productivity improvement, the audit may also assess the outcomes or performance metrics of the project. This is to ensure that the grant's objectives are being met.

• Independent Auditors: Grant audits are often conducted by independent auditors to ensure an objective and unbiased review. These auditors are typically external and not affiliated with the grant recipient.

• Frequency and Timing: The timing and frequency of grant audits can vary. Some audits are conducted after the project is completed and the grant is fully utilized, while others may occur at different stages of the project.

• Consequences of Non-Compliance: If an audit finds that the grant funds were not used as intended, or there were violations of the grant terms, the grant recipient may face consequences. These can include repayment of grant funds, ineligibility for future grants, and in severe cases, legal action.

• Preparation by Grant Recipients: To prepare for a grant audit, recipients should maintain organized records of all grant-related activities and expenditures, ensure compliance with the grant agreement, and be ready to provide clear explanations and documentation for the auditors.
   

A Grant Audit is a vital tool for maintaining transparency and accountability in the use of government grants. It helps to ensure that public funds are used effectively and for the intended purposes, thereby supporting the broader economic and social objectives of these grants.

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Please let us know at 98638665.

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