The Role of the Audit in Combating Fraud
An audit does not just provide confidence to the owner that a business is in good shape, it also offers evidence and assurance to third parties. An Audit permits the stakeholders of a business such as shareholders, banks, suppliers, customers and even staff to make better informed decisions about its current performance and their subsequent relationship to it, providing additional comfort when deciding whether to invest in, provide finance to, or trade with that business.
Whilst an Audit does not set out to find fraud, a well planned audit carried out by an auditor who understands the business, its systems and processes should significantly reduce the risk of fraud going undetected.
New statistics released from the Charity Commission show that two thirds of fraud are picked up by financial controls or both internal and external audit.
They state that “application of financial controls and audit remain core to timely identification” and that robust financial controls are also “first vital steps in fighting fraud”
Whilst these statistics are based around tackling fraud in the charity sector the findings and subsequent recommendations can be a useful tool for all business sectors.
With the latest developments in technology the ability to unlock more value from the Audit is now possible, offering deeper insights & opinion and making shareholders aware of key risks and how they should be addressed: leaving you with a greater overall understanding of your organisation, reassurance that you have undertaken basic good practice in countering fraud, plus an ability to both improve efficiency and resolve future accounting issues in a more effective and cost efficient manner.