Audit of company financial statements: independent verification of reporting reliability, external and internal audit, recommendations. UHY Prostir.
Financial statements are a critical element that affects management decisions, investor attraction and cooperation with creditors. The purpose of a financial statements audit is to obtain an independent judgement on the accuracy and truthfulness of the statements — which helps avoid financial errors and fraud.
What is a financial statements audit
A financial statements audit is an independent verification of the statements’ reliability and compliance with the applicable framework. Its main goals are to assess the company’s financial position, confirm the legality of transactions and provide an objective assessment of reporting figures. An independent review is especially important for shareholders, investors and other stakeholders.
Types of financial statements audit
External audit — an independent assessment of the organization’s financial statements by an independent audit firm. Its main tasks are to check the statements against regulatory requirements and professional standards; confirming the truthfulness of financial information builds investor and creditor confidence.
Internal audit — an in-house process of assessing and analysing the company’s financial activity by its own staff or specialized units, focused on improving internal business processes and management effectiveness. Companies sometimes choose an express audit of financial statements to quickly assess their finances and the compliance of their accounting with the law.
The audit process
Planning and preparation — defining the scope, developing the strategy and assessing risks, taking into account all regulatory requirements.
Data collection and analysis — analysis of balance sheets, profit and loss statements and cash flow documents; analytical procedures to identify possible discrepancies or errors.
Reporting and recommendations — a report with the review results and recommendations for improving financial reporting; the audit opinion forms an objective picture of the company’s activity.
Benefits of a professional audit
- Greater investor and creditor confidence — confirmed truthfulness and transparency of financial data strengthens the company’s reputation with stakeholders.
- More effective management — identification of weak spots in financial activity and recommendations for eliminating them.
- Risk identification and mitigation — risk assessment reveals possible threats and helps develop strategies to avoid them.
How to choose an audit firm
- Experience and qualifications. Choose a firm with experience in your niche and professionally certified auditors.
- Reputation and reviews. Study client feedback and the firm’s market reputation.
- The required permit for auditing specific entities (e.g. banks, insurance companies, public companies).
Why clients choose us
Since 2008 UHY Prostir has been part of the international UHY International network, which guarantees high-quality audit services. Our professionalism has been recognized by the World Bank and the European Bank for Reconstruction and Development (EBRD) — both included UHY Prostir in the list of audit firms eligible to audit their clients’ financial statements.
We are full members of IFAC, hold Ukrainian and international certificates and, beyond standard audit services, provide advisory support to the client’s management: preparation of financial statements, bookkeeping, verification of primary documents, HR records, legal matters, management accounting, tax reporting, optimization of the tax burden, building and testing internal control systems, and assessing the qualifications of accounting staff.
To order a financial statements audit, send a request on this site or an email to hello@uhy-prostir.com — we will prepare the terms of reference and agree on the cost and timing.
Frequently asked questions
Is a financial statements audit mandatory for all companies?
No — the audit is mandatory only for large and medium companies, public companies, banks, insurers and in certain other cases defined by Ukrainian law, but it can be voluntary for other legal entities.
How often should a financial statements audit be performed?
An audit is usually performed annually after the end of the financial year.
What documents are needed for the audit?
Primary documents, financial statements (balance sheet, profit and loss statement, cash flow statement, etc.), accounting data, tax reporting and information on operating activities.
How long does the audit take?
Usually from several weeks to several months, depending on the complexity of the engagement.
Can an internal audit replace an external one?
No — an internal audit does not replace an external one, as they perform different functions and pursue different goals.
What are the qualification requirements for auditors?
Auditors must have the appropriate education and professional certificates, and the firm must be included in the relevant section of the audit oversight register.
What if material errors are found in the statements during the audit?
The errors should be corrected following the auditors' recommendations, and the control systems improved.
Do newly created companies need an audit?
Newly created companies are not obliged to undergo an audit, but it can be useful for strengthening management accountability and ensuring correct reporting.
Related insights
5 min read
How to Choose an External Auditor for an NGO: Criteria and Recommendations
5 min read
The Importance of Auditing for Trust in NGO Activities
7 min read
How to open bank a account for a public organization and decide who will keep the accounting records
4 min read
Verification of Funding Usage and Preparation of Audit Reports
Describe your task
We will suggest a cooperation format and come back with a specific proposal.