Statutory audit
Statutory audit
Our approach focuses on the company and its objectives. In this way, we provide insight into the functioning of the company and turn the audit into a valuable instrument for our clients.
About statutory audit of the financial statements
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In addition, we will examine the internal organization and processes in detail.
The idea here is to make as much use of these processes as possible from an efficiency perspective, but also to jointly look at what can possibly be improved based on the current processes.
A good example of this is the risk analysis. Often the risks relevant to an accountant are also the risks that concern the company.
Based on the outcome of the above activities, we draw up an audit approach. When planning the execution of the audit, we ensure that the audit team consists of as many of the same people as possible over the years. This creates a well-integrated team. Given the limited turnover of our employees in recent years, this is also something that we can really deliver on.
After the audit, we will report our findings, including the auditor’s report on the financial statements.
Our audit approach consists of the following 5 phases:
1. Planning phase — insight into your organization and environment
In the first phase, we focus on thoroughly getting to know your organization. We collect both internal information (processes, structure, systems, previous audits) and external information (market developments, laws and regulations, industry characteristics).
This forms the basis for an efficient and risk-oriented audit. By gaining a good picture of your activities from the start, we can tailor our work exactly to what is relevant to your organization.
We also include gaining insight into your internal processes in the planning phase. We already carry out work during the planning phase regarding the design and existence of your processes, your AO/IB. This enables us to get to know an organization quickly and well.
2. Risk analysis and audit approach — determining where material risks can arise
With the knowledge gained, we identify the risks that could lead to material errors in the financial statements. This includes estimates, complex transactions or sensitivities in processes.
Based on this risk analysis, we determine an audit approach that suits your organization: focused, well-considered and proportionate. This creates the optimal balance between audit effort and quality.
We will discuss the risks in advance, including any shortcomings in the processes (ao/ib). This is important to ensure that you understand why we perform certain activities and prevents us from possibly performing activities that could have been more targeted.
In that regard, we see the execution of the assignment as a joint effort. We believe that this is important not only to carry out a good audit qualitatively and efficiently, but also that our clients get the most added value from an audit in this way.
We will report findings in writing in the form of a management letter and/or auditor’s report.
3. Interim audit — testing processes and internal control
During the interim period (preferably during the financial year), we examine the functioning of relevant internal processes and control measures.
By determining early on whether internal control is effective, we can organize our work more efficiently and identify any points for improvement in a timely manner. This prevents surprises after the end of the year and increases the predictability of the audit process.
4. Substantive procedures — checking figures and supporting documents
After the end of the financial year, we perform our substantive procedures. Here we focus on the underlying transactions, figures and notes in the financial statements.
We perform detailed checks, data analyses and analytical reviews to determine whether the financial information is reliable with a reasonable degree of certainty.
We will agree with you in advance which information we need for this so that you can prepare this well in advance and there are no unnecessary delays.
5. Completion and reporting — insight, substantiation and transparency
In the final phase, we assess the findings of our audit and, based on this, the scope of the auditor’s report.
We report our conclusions to management and supervisors and provide — as soon as justified — our auditor’s report. In addition, we discuss any recommendations so that your organization can further professionalize.
Personal approach
Frequently asked questions
What exactly is a statutory audit?
A statutory audit is a mandatory audit of the financial statements for companies that meet certain size criteria. See also our checklist.
When is my company subject to mandatory audit?
You are subject to mandatory audit if you meet two of the three legal criteria for two consecutive financial years with regard to the size of the balance sheet total, the size of the turnover and the average number of employees in a given financial year. See also our checklist.
What is the difference between a statutory and a voluntary audit?
A statutory audit is required by law, while a voluntary audit takes place at the request of the company. With a voluntary audit, you choose extra security for shareholders, financiers or other stakeholders.
How long does a statutory audit take on average?
A statutory audit is required by law if certain criteria are met. A voluntary audit is an audit that does not fall under the statutory audit criteria. This does not mean that an audit is always truly voluntary. For example, the audit may be required from a subsidy. Even then, such an audit is called a voluntary audit.
Of course, a voluntary audit can also be a matter of choice. You then choose extra security for shareholders, financiers or other stakeholders.
What can I do to ensure that the audit runs efficiently?
Good preparation helps enormously. Consider:
Timely delivery of all required documents
Clear division of tasks within your organization
Availability of the financial administration
We will send you a checklist in advance to prepare everything properly.
Who will carry out the audit at our company?
At The Audit Company you have direct contact with the responsible partner and the audit team. We attach great importance to personal involvement, short lines of communication and fixed points of contact.
What happens after the audit?
After completion, you will receive an auditor’s report and we will discuss our findings with you. In addition to the opinion on the financial statements, we also provide recommendations where possible to further improve your internal processes.
What does a statutory audit cost?
The costs depend on the size, industry and complexity of your organization. We always offer a transparent, customized quote, so you know where you stand in advance, without any surprises afterwards.
Working together on trust and clarity.
Marten Bouma
Partner
Does our vision of a personal approach appeal to you? Would you like to know what we can do for your organization? Please feel free to contact us, we would be happy to talk to you.