Normally, the scope of our audit services is determined by the statute under which we are appointed, the objective being to issue a report that meets the requirements of the particular statutes regulating the mode of operations of the concern or business entity which we are auditing.
In addition, we use a system based approach. The approach involves documentation and evaluation of the accounting systems, procedures and controls, thereby forming an ideal basis for advice to management as to the adequacy or otherwise of those systems and the effectiveness of their operation.
In the process of an audit, if we become aware of any weakness in the organization’s system of internal checks and control, we could formally communicate such weaknesses to the governing board of the business entity or corporation making recommendations and suggestions for their rectification and elimination.
Letter to management on completion of an audit may typically draw attention to the following matters
- Weakness and inadequacy in systems or procedures.
- Instance of non-compliance with established control procedure.
- Problems in the efficient and timely preparation of accounting records and management accounts and reports.
- Instances of non-conformity with internationally accepted accounting principles or local accounting standards and conventions.
- Potential taxation and other local legal and statutory problems. In any case, our comments are accompanied by constructive recommendations or improvement and both comments and recommendations are discussed fully with management as to factual, accuracy, practicability and effectiveness.
