Forging of Documents

What is an Audit?

An Audit is an objective examination and evaluation of the financial statements to make sure that the financial records are true and fair of the financial position of a company. The audit can be conducted internally by employees of the organization or externally by an outside Certified Public Accountant (CPA) firm.

Why Are Audits Important?

An Audit provides credibility to a set of financial statements and gives the shareholders confidence that the accounts are true and fair. (Cited From https://www.plusaccounting.co.uk/knowledge/blog/why-are-audits-important)

What causes an Audit to fail?

Failing a compliance audit signifies that the security protocols you use are lacking in some key areas and need to be immediately addressed. Having these gaps or holes in your internal control or IT security system could lead to a variety of very expensive consequences. (Cited from: https://www.coloradosupport.com/what-happens-when-you-fail-a-compliance-audit/)

Consequences of an Audit Failure:

• Loss of Trust – If people can’t trust your site to keep their vital information secure such as intellectual property, credit, and identifier information, your business is going to lose their business as a consequence.
• You Could Be Sued – Some of the big-name players have had to pay out MILLIONS in lawsuits after they were breached and vital data stolen. Large companies may be able to withstand a major lawsuit but what about your company?
• Fines – The banks and other financial institutions aren’t what you would call benevolent when it comes to money. They might step in and cover the loss of credit card fraud if your company is breached, but they will likely come to you afterward to reimburse them for your security mistakes.
• Coming Under the Authority’s Magnifying Glass – If it is a government agency that has performed the audit and found you are lacking in some areas, they are going to flag your company for more detailed monitoring later on. Our authorities are well known to have very, very strict compliance requirements.
• Internal Costs – When you fail a compliance audit, you have to find out why these weaknesses occurred and where your company is most vulnerable. This means you are going to have taken the time and expense to find out who dropped the ball and what it’s going to take to get it fixed. These costs and loss of productivity will come out of your pocket!
• Lost Reputation – If you fail a compliance audit and don’t address the issues which lead to a breach, your damaged reputation could end up costing you a large segment of your client base, which you could take a long time to re-build.

Example of an Audit failure:

Auditor KPMG fined £14.4m over Carillion collapse

Accountancy giant KPMG has agreed to pay a £14.4-million (S$24.6 million) fine for giving false information to regulators prior to the collapse of construction group Carillion, it said Friday (May 13) after hearings concluded.

The penalty, equivalent to 16.8 million euros (S$24.3 million) or US$17.6 million, was agreed by Britain’s Financial Reporting Council (FRC) regulator and KPMG, according to a spokesperson for the auditor. 

(Source: https://www.businesstimes.com.sg/banking-finance/auditor-kpmg-fined-144m-over-carillion-collapse)

Why should you trust us?

As an Auditing firm, we take the trust of our partners with utmost importance. We value integrity, virtue, and respect. 

Accounting Services By CoSeClinic

Accounting is a significant process to record and evaluate the financial performance of your company. Our team of qualified and experienced accountants at CoSeClinic has vast knowledge and experience in providing reliable accounting services. To know more about our services feel free to contact us at enquiry@coseclinic.com or call on +65 62701163.