Industries can greatly benefit from the focus on controls that can be carried out in a financial statement audit.
In this type of audit, the auditor not only concentrates their effort on validating financial figures and information to be used in decision-making and presented to third parties, but also focuses their work on evaluating and controlling the internal processes of the industrial company.
In this way, an auditor can identify critical areas of weakness and opportunities for improvement in the analyzed processes. Some examples of issues identified through audit procedures are:
• Fraud, shortages or misappropriation of funds or stock
• Commercial or financial operations executed without prior authorization
• Concentration of single-person decisions without control or analysis
• Contingencies in compliance with current regulations
• Errors in registrations or irregular information
To successfully carry out these audits, it is essential to have a highly specialized internal control team, as well as the availability of appropriate audit software and data analytics. In recent years, the use of artificial intelligence tools to optimize and automate controls has also been highlighted.
Finally, the audit findings are presented to the company’s management through a findings report, to define continuous improvement action plans.
Javier Panno, Quality Manager from Auren Argentina