The Companies Act prescribes a certain level of supervision and review or audit based on the classification of the company. Not all companies are required to have their accounts audited. In addition, not all companies are required to have an audit committee. This analysis of the Companies Act explains the auditing requirements that companies, governments, semi-public organisations and not-for-profit organisations in South Africa must meet, from the examination of financial statements to the classification of companies to the appointment of audit committees and the required accounting standard. An audit is a service hired by a company to have its financial records and transactions audited by an independent accounting firm, a third party or an impartial auditor or CA to avoid conflicts of interest and ensure the integrity of the audit. When a company is audited, the independent auditor looks at both the underlying financial data and the organizational elements designed to prevent fraud and ensure the accuracy of the information. The audit process and the declarations generated by these procedures offer significant benefits to any organization. As a result, many groups conduct regular audits to promote the health of the organization. Public companies, private companies, companies that control large pension funds for their employees, and not-for-profit organizations may be required by law to submit annual audited financial statements to ensure compliance and provide sufficient financial information. If a not-for-profit organization is small and has not conducted an audit because of its costs, it should not hesitate to ask the funder whether a more affordable method of assessing the nonprofit`s financial situation would be acceptable, such as a review of certified financial statements.
The majority of standard limited liability companies (i.e. companies with their own responsibility) are subject to external audit if they meet two of the following criteria: A listed company is any publicly traded company organized in order to sell ownership shares. In the United States, publicly traded companies must file an annual Schedule 10-K with the U.S. Securities and Exchange Commission. The 10-K gives investors and regulators an overview of the past year and outlines the company`s financial position and long-term prospects. One of the elements required to complete the 10-K is the preparation of audited financial statements. The objective of the audited financial reporting obligation is to ensure that the public can be fully assured that the information disclosed by the public undertaking is accurate. This is crucial, otherwise the public will not be able to verify the information. Public companies are also required to file quarterly or 10-Q reports, but this form does not require audited financial statements. We have a variety of audit resources, which can be found below: Audit questions are likely. At The Baird Audit Group, we are ready to help you and your business by educating you on compliance, understanding and verification. Baird Audit Group has a long history of audit, tax, consulting and accounting, and we have developed a range of audit specialties.
Our team is trained in government management, auditing, accounting and more to better serve you and your business. Contact us online today, by email or by phone at 706-855-9500. Many for-profit businesses require audits, particularly those that participate in federal programs. The SEC also requires publicly traded companies to file audited financial statements in accordance with GAAP (generally accepted accounting principles). Companies whose ownership, stocks and bonds are traded on U.S. public markets are also required to conduct annual audits by an independent CPA firm. This is required by the Federal Securities Acts of 1933 and 1934. It is imperative that you have enough time to inform your finance team of your business issues, as well as time to complete their list of audit requests. Not-for-profit organizations are businesses dedicated to the public interest rather than to generating revenue for their owners. These companies are often regulated by federal and state tax laws. A not-for-profit organization may be required to submit annual audited financial statements for two reasons.