What is the difference between an internal audit and statutory audit

All companies are subject to audit processes – whether private or public companies. Any organisation that has to show accountability for their operations and financial health is required to maintain records, accurate and compliant accounting practices and reporting.

The extent of the method for determining their transparency and accuracy depends on the size, and to a certain extent the operational and legal structure of the business. The process can be a review or a more in-depth audit. Large businesses, corporations, public companies and government organisations are subject to annual statutory audits.

Internal Audit:

An Internal Audit is just as important for the financial health of a company. However, they are designed to prepare and ensure a company’s financial health for its own sake as well as prepare companies for external and statutory audits.

• Internal audits can be annual or done at other incremental time-periods.
• These audits provide financial and operational assurance to companies and company shareholders in addition to statutory assurance – where applicable.
• Internal audits also help companies streamline their financial operations and maintain internal controls.

TAT’s expertise includes financial reporting with full statutory compliance ensuring that your financials are fully compliant with the laws of the land. Don’t hesitate give us a call and lets get your business up to date and compliant.

Statutory Audits:

Statutory Audits are defined as the legally required (or ‘required by statute) in-depth examination of the accuracy of a company’s financial statements (and the validity of their financial records).

• Statutory audits are done to determine whether a company is presenting an accurate representation of their financial position, as well as establishing fairness and statutory compliance in the operations that create that position.
• Records that will be examined include all financial records – from Year End down to bookkeeping balances, banking records, and all financial transactions.
• The statutes involved can be multi-level – national, government, industry-related and municipal.
• Statutory audits are especially important for companies that are accountable to shareholders and the public through their operations and financial dealings.
• Statutory Audits provide statutory compliance and financial transparency assurance.