Although internal audits contribute to improve production
processes and identify possible weak points within methods or
procedures, they cannot totally replace audits performed by external
auditors. Benefits of external audits are for example, that external
auditors provide an objective opinion, as internal auditors are simply
employees of the company. Also, firms experience immediate correction or
improvement of process deficiency, the external auditors finds.
External auditors focus primarily on whether the financials are
misleading. The long-term benefits of external audits include assurance
for the management board, that accounting processes are effective, as
well as increased confidence by investors, regulators etc. So, even if
it does not seem necessary to appoint external auditors, the facts
mentioned above, speak for themselves and certainly achieve a balance of
the cost-benefit factor.
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