Audit by Certified Auditor vs. Organizational-Accounting-Financial Audit: Understanding the Differences
An audit by a certified auditor is an official, and in some cases mandatory, form of examining a company’s financial statements and their accuracy. When seeking to identify the root causes of issues or practical solutions to improve company operations, translating financial audit results into an effective action plan can be less effective. Why is that?
In this article, we compare the audit by a certified auditor and the organizational-accounting-financial audit conducted by Cafe Finance at the request of clients.
What is an Audit by a Certified Auditor?
The scope of a certified auditor’s audit is strictly defined and focuses on analyzing accounting records, financial transactions, accounting procedures, compliance with financial reporting regulations, and assessing financial risk. The result is an opinion on the company’s condition, which is crucial for stakeholders such as owners, investors, lenders, and regulatory bodies.
Although the official auditor’s report is mandatory for institutions like financial institutions and joint-stock companies, it is not the best way to understand the current state of your company. It primarily assesses the accuracy of accounting records as of the balance sheet date, typically December 31. This means that the auditor’s report is based on historical data and is usually produced with a several-month delay. It is a useful and necessary tool, but it is important to understand its purpose.
However, if you want to understand how your business operates in selected areas, identify its strengths and weaknesses, and receive expert recommendations on which direction to take and which tools to use for effective operation, consider an organizational-accounting-financial audit.
What is an Organizational-Accounting-Financial Audit by Cafe Finance?
An organizational-accounting-financial audit is a thorough analysis of a company’s operations, resulting in a report on the state of the business, usually in selected areas. It also includes recommendations for further development, considering the methods, benefits, and costs of implementing the suggested solutions.
Companies that approach us for an organizational-accounting-financial audit may want to:
- Analyze accounting schemes and account plans
- Check document qualification and compliance with source documents
- Review selected personnel files for legal and internal procedure compliance
- Verify data security based on current procedures
- Check for indications of insolvency
- Introduce or improve budget control methods to minimize irregularities
- Validate the correctness of tax declarations and accounting entries
- Analyze payments to employees against contracts
- Review data from selected contracts and recorded documents
- Assess internal control systems
- Evaluate process mapping in areas like finance
- Identify potential financial, operational, legal, and other risks
- Receive conclusions on possible cost optimizations
- Analyze financial, process, and organizational indicators with potential corrections
In return, companies gain an impartial opinion from external experts, recommendations for improving processes, risk analysis, and strategically planned preventive actions. They receive full transparency of the information provided, which helps them make informed strategic decisions.
Key Differences Between a Certified Auditor’s Audit and an Organizational-Accounting-Financial Audit
| Aspect | Certified Auditor’s Audit | Organizational-Accounting-Financial Audit |
|---|---|---|
| Requirement | Mandatory | Voluntary |
| Legal Regulations | Legally regulated | No formal regulations |
| Timing | Required by law | Flexible |
| Who Conducts the Audit | Certified Auditor | No formal requirements; requires extensive experience in finance and business |
| Areas Examined | Analysis of accounting records, transactions, procedures, risk, and compliance with financial reporting regulations | Typically covers finance, HR, payroll, law, procurement, data security; focuses on process accuracy, efficiency, risk analysis, and process/cost optimization |
| Results | Auditor’s report with compliance opinion | Report with findings and recommendations |
When to Conduct an Organizational-Accounting-Financial Audit?
Conduct an audit when you are ready to implement changes. An audit is ineffective if its recommendations are not acted upon. To identify areas needing improvement, enhance internal processes, and ensure efficient resource management, you must be prepared to accept facts based on thorough analysis and data verification.
Decide when to conduct the audit before making significant decisions for the company. The results will greatly influence the perception of the company’s actual condition and enhance your awareness of planned actions.
What is the Organizational-Accounting-Financial Audit from Cafe Finance?
The organizational-accounting-financial audit from Cafe Finance typically covers financial aspects, payroll, cost analysis, organizational structure, internal management processes, data security, and business risk assessment in selected areas. It also includes evaluating compliance with legal regulations, internal policies, and other relevant factors.
The scope of work is closely tied to the specific situation of the audited entity and its needs. Depending on requirements, the audit may cover:
- Organizational Aspects: Checking compliance with organizational regulations, analyzing organizational structure versus business processes, and examining contracting procedures.
- Accounting Aspects: Analyzing account plans, accuracy of tax declarations and accounting entries, and accounting schemes.
- Financial Aspects: Evaluating procurement processes, revenue and costs, investment expenditure accuracy, obligations from contracts, grants, financial data security, etc.
The Cafe Finance Group team analyzes the collected documentation and prepares a report with recommendations and an optimal action scenario.
Example report page: here
How Long Does an Organizational-Accounting-Financial Audit Take?
Prepare for a period ranging from a few weeks to several months. During this time, we analyze provided documents, data, and conduct detailed interviews with relevant personnel. We maintain constant contact and keep you updated on progress. The audit can be conducted on-site, remotely, or in a hybrid format. After reviewing all documents and processes affecting the company’s operations, we prepare a detailed report on the current state and recommendations for improvements.
Benefits of Regular Organizational-Accounting-Financial Audits
Regular audits allow you to monitor the direction in which your company is heading. Through periodic reviews of internal processes, you can:
- Quickly identify the causes of operational issues
- Spot areas with potential for increased efficiency
- Predict possible future scenarios for the business
- Prepare an opening report – e.g., when changing executives, an audit report ensures a “clean slate”
- Identify potential threats and risks that could negatively impact the company
- Continuously analyze clear and transparent reports for better company control
An organizational-accounting-financial audit provides an impartial and objective assessment of the organization’s actual state. Conducted by experienced specialists, it offers valuable insights for management. The findings can reshape the company’s image and positively influence decision-making. Recommendations from financial and business experts shed new light on past results and enable informed financial decisions.
Is your company facing financial inconsistencies or organizational issues? Or perhaps you want to thoroughly examine your company’s operations to avoid future financial problems?
We can help. Let’s discuss auditing your company. Contact us today!
