5 Things to Consider Before Hiring an External Auditor
5 minute read
Hong Kong has one of the most advanced legal systems in the world. However, just like any other business hub, the laws that are enforced are strict and it is of the utmost importance that they are followed.
Auditing in Hong Kong is mandatory. Unfortunately, many businesses do not realize how auditing often gets complicated.
Once the authorities realize that there was no proper auditing of a company, legal troubles begin. Therefore, it would be best to go through a decent audit checklist first.
Apart from that, there are also a few factors that need to be considered before hiring an external auditor that would take care of this task for your business.
Benefits Of Hiring An External Auditor
Auditing is one of the essential duties of a financial department in a company. Considering this, many companies keep it as an internal process.
However, there are some very good reasons why hiring an external auditor may be a better idea.
An External Auditor Is Unbiased
When a company hires a third-party auditor to do the audit, they do not have a sense of emotional and professional attachment to the company.
An external auditor is able to see the problems and create solutions that are unbiased. An auditor that is not a regularly-employed professional working at the company premises has no fear of offending anyone in the company.
There is no risk of the audit results being defensive or anything other than an accurate proof that shows all important details.
Greater Credibility, Higher Reliability
It does not matter if you need auditing for investment, presentations, or IRD purposes. An external audit will be seen as more credible when compared to an internal one.
When the authorities know that someone is not linked with the company, they get a sense of truthfulness and transparency. In turn, this would make a company look far more credible and thus more reliable.
Better Efficiency
With an auditing agency or an external auditor hired to do this task for a company, the whole auditing is no longer a burden that has to be dealt with at the office.
In turn, this relieves employees of a huge and important task, leaving them with more time and less stress to focus on other duties.
Additionally, this could streamline the business operations and processes, which would significantly help with overall business performance and efficiency.
5 key Considerations Before Hiring An External Auditor
As you could see, hiring an external auditor will bring you quite a few benefits. However, bear in mind that there are some important considerations to keep in mind if you want to hire the right auditor for your company.
These will help you determine if the audit company or an auditor is the right fit for your business and its specific needs.
Industry Experience
Having an experienced auditor that is familiar with your industry means having efficient audits with little to no mistakes.
Additionally, an experienced auditor provides more relevant services so that your business gets accurate reports and meaningful information specific to your business.
Finally, having a professional working for you will also allow your own audit staff to take some notes and learn how they can contribute.
Competency
A competent auditor knows how to use the latest technology to gather important data used for your audit.
This means that your business will not miss out on important insights. A competent auditor uses the latest tools to pull useful data that is further digested to find errors.
This use of technology also frees up the auditor to take more time to assess the findings, interpret the data, and focus on business implications.
Independence
When hiring an auditor, make sure that you do not hire someone from your own company. Hiring someone who is not part of your business results in getting an unbiased audit and review.
On top of that, most regions require the auditor or the auditing company to be independent so that they can provide a true and fair view of the financial statements with no bias or personal interest.
Audit inaccuracies can never bring good results in the long run. Apart from that, the legal effects of this are never positive.
License
According to the law, the auditor or the audit firm needs to be licensed before they take on any clients. As a client, you definitely need to make sure that your auditor is licensed so that you don’t end up choosing an illegal audit firm.
An entity performing these services illegally can jeopardize the whole business, since the Hong Kong law is rigorous when it comes to taxes and finances.
Budget
Finally, before you hire an external auditor, you should make sure that you are getting the most out of service for the money you are about to spend.
However, this also means that the budget determines whose services you can afford. Some audit firms and auditors are quite expensive, as they offer much better services than others.
So, determine your budget before you start looking for auditors. This will help you know how much you can afford and what you are willing to pay to get your book of accounts audited on a yearly basis.
Wrap Up
Auditing is an aspect that needs to be taken care of by every serious business. Remaining within legal boundaries is a priority of every successful business.
And even though auditing can be complicated, that is not the case with Sleek. Sleek auditing meets all of the stipulated requirements and conditions in Hong Kong. The audits performed are accurate and in-depth, performed with the help of the latest finance software solutions.
In addition to that, Sleek helps to streamline all of these processes for its clients, which allows the companies to have their staff focus on more important matters.
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