How to Choose an Auditor for Your Business?

source: amcorp

Running a business or firm successfully involves a lot of factors, one of them being choosing the right auditor for it. It will be tricky and challenging to find one as they will have access to highly confidential information regarding your business’ finances. Also, their insights will be favourable for your organisation’s success.

So, choosing a reliable, qualified, and quality auditor is of utmost importance for your organisation. Take a look here to know more about how to choose an auditor.

Finding the right auditor for your business is extremely important, as there are probable chances that you will have to work with them year after year. So, during this high-stake time, don’t compromise otherwise it might hamper the reputation of your streamlined business.

So, consider trying out a few recruiting methods to choose the right auditor for your business:

• Look Out for Available Resources Online: There are some online documents available that list the public auditing firms along with their employees. You can reach out to these firms to check whether any auditor is available for hire.
• Post Your Job Online: Another promising way to choose an auditor includes posting your auditor job requirements along with full details on various popular recruiting sites and communities to encourage and attract potential candidates for the specified post.

While finding an auditor, ensure to conduct your own research thoroughly because it will have long-term implications for your business.

Businesses and organisations hire auditors based on their requirements and accessibility. Like, businesses usually look for full-time auditors so that they can consistently monitor the company’s financial transactional records and prevent it from entering any incorrect information to it.

While large and small companies usually opt for freelance auditors to examine their current financial records and check if anything goes wrong. They also offer advice on how to prevent the risk of fraudulent activities on your business.

Apart from this, there are other types of auditors as well that one can hire:

• Internal Auditors: Organisations usually hire these auditors for offering an independent, in-house evaluation of financial as well as operational business activities that even includes corporate governance.
• External Auditors: These auditors typically work along with government agencies for providing a public opinion regarding the financial statements of the organisation. They also ensure the fact whether these statements accurately represent the financial position of the organisation or not.
• Government Auditors: These auditors examine the financial records of government agencies and of private businesses that maintain government regulations. Their job is to detect fraud, evaluate risk management and analyse the accounting controls of agencies.
• Forensic Auditors: These auditors are usually hired by law enforcement organisations as they specialise in detecting any frauds and crimes in the organisation.

Besides knowing how to pick an auditor for your business, one should also consider and check these credentials to ensure choosing the right one:

• Authorisation: Only limited firms and organisations are authorised and registered for carrying out statutory audits for any organisation. So, ensure that the auditor that you are choosing is an authorised one.
• Technologically Advanced: Ensure that your auditor is updated with the latest technology in order to get a much more efficient audit engagement. While conducting an audit, they also perform data analytics and offer valuable insights from data crunching. Through utilising technology, auditors are quickly able to find anomalies and take more future-focused actions for improving your business operations.
• Industrial Experience: If the auditor has relevant industrial insights and is versatile enough, they will be able to engage much more efficiently. They will also be able to boast your business by providing value-added services and bringing about a lot of industry knowledge.
• Reputation: When it comes to an auditing firm or an auditor, reputation matters a lot. This is because auditors should always maintain their code of ethics in their profession. So, if an auditor has a bad reputation, then it might drastically impact your business. Thus, before choosing an auditor, ensure to question their methodology of auditing and analysing their reputation.
• Quality Assurance: Make sure that the auditor you are choosing should be able to determine their compliance with the auditing standards, legislative requirements, and best practices. They should be able to demonstrate that their service quality is professional through peer reviews or any other procedures.

Last but not least, ensure that your auditor has a good understanding of the ins and outs of your business. So, if anything possibly goes wrong during the audit procedure, it could be swiftly resolved with clear communication with the management.

In the process of how to choose an auditor, it is crucial to question and interview the auditor for getting an in-depth grasp of their knowledge and experience. So, if a company or business firm is looking for auditors, they can ask them these questions:

• Does the auditor have experience in a firm that has a quality control system? Does their peer review been performed within the last 3 years?
• How many audits have been performed by them every year?
• Whether they are an active member of any organisation? If so then how is it helping them in gaining expertise in auditing?
• Has the auditor previously worked for firms specialising in this particular area?
• How professional is their service quality?

Apart from these basic questions, you can also ask them about their standard services and regulations and about their charges for conducting audits for your organisation.

Also, the service tax should also be collected by them separately, if and when applicable.

• Class A cities include Delhi, Kolkata, Bengaluru, Hyderabad, Greater Mumbai, Ahmedabad, Pune, and Chennai.

• Class B cities include Chandigarh, Bhubaneswar, Agra, Allahabad, Guwahati, Gurgaon, Amravati, Ajmer, Ghaziabad, Aligarh, Kanpur, Kochi, Asansol, Amritsar, Bhavnagar, Kollam, Bareilly, Aurangabad, Bhopal, Bhiwandi, Belgaum, Coimbatore, Bokaro Steel City, Bikaner, Firozabad, Cuttack, Faridabad, Erode, Indore, Gwalior, Greater Visakhapatnam, Gorakhpur, Hubli-Dharwad, Guntur, Gulbarga, Jhansi, Jaipur, Jabalpur, Jamshedpur, Jamnagar, Kannur, Jodhpur, Jammu, Jalandhar, Kolhapur, Kota, Ludhiana, Lucknow, Kozhikode, Mangalore, Meerut, Nansws-Waghala, Nagpur, Malegaon, Mysore, Malappuram, Madurai, Moradabad, Puducherry/Pondicherry, Nellore, Nashik, Patna, Noida, Rourkela, Srinagar, Ranchi, Sholapur, Rajkot, Siliguri, Sangli, Raipur, Tiruppur, Saharanpur, Thiruvananthapuram, Salem, Warangal, Varanasi, Thrissur, Vasai-Virar City, Ujjain, Surat, Tiruchirappalli, Vadodara, and Vijayawada.

• Class C cities include those that are not mentioned in Class A and Class B cities.

The audit fees charged by the auditor also depend upon the complexity of the task as mentioned by the organisation and the number of days that they need to spend conducting the audit.

The table describes the charges as per their minimum indicative fees.