What does a Singapore auditor do for Statutory audit services – In Singapore, statutory audit services involve the examination and evaluation of a company’s financial statements to ensure that they provide a true and fair view of the company’s financial position and performance, in accordance with the relevant legal and regulatory requirements. Here’s an overview of what a Singapore auditor typically does when providing statutory audit services:
- Understanding the Business and Its Environment: The auditor gains an understanding of the business, its operations, the industry in which it operates, and the legal and regulatory framework. This includes understanding the company’s internal control system.
- Assessing Risks: The auditor assesses the risks of material misstatement in the company’s financial statements, whether due to fraud or error. This involves identifying areas where financial statements might be susceptible to significant misstatements.
- Planning the Audit: Based on the risk assessment, the auditor develops an audit plan, determining the nature, timing, and extent of audit procedures to be performed.
- Gathering Evidence: The auditor collects evidence through various means, such as inspection, observation, inquiries, and confirmations, to ascertain the accuracy and completeness of the information presented in the financial statements.
- Evaluating Accounting Policies and Practices: The auditor evaluates the appropriateness of the accounting policies used by the company and the reasonableness of accounting estimates made by management.
- Checking Compliance: The auditor checks compliance with the Singapore Financial Reporting Standards (SFRS) and other applicable laws and regulations.
- Testing Internal Controls: The effectiveness of the company’s internal controls over financial reporting is tested. This includes assessing whether controls are properly designed, implemented, and maintained.
- Performing Substantive Procedures: These are detailed tests of financial transactions and balances, including analytical procedures, to detect material misstatements.
- Forming an Opinion: Based on the evidence gathered, the auditor forms an opinion on whether the financial statements as a whole are free from material misstatement and present a true and fair view of the company’s financial position and performance.
- Reporting: The auditor prepares an audit report which includes the auditor’s opinion on the financial statements. This report is then presented to the shareholders, board of directors, or other stakeholders as required.
- Communication with Management and Governance Bodies: The auditor communicates significant findings to management and those charged with governance, including deficiencies in internal controls, instances of non-compliance, and other matters that need attention.
- Follow-up: In some cases, auditors may also be involved in follow-up activities, especially if they have identified significant issues that require action by the management.
Statutory audits in Singapore are mandatory for all companies unless they are exempted. The audit must be conducted by an auditor or an audit firm that is registered and approved by the Accounting and Corporate Regulatory Authority (ACRA) of Singapore. The primary goal of these audits is to enhance the reliability of financial statements, thereby protecting the interests of shareholders, creditors, and other stakeholders.
What does a Singapore auditor do for Statutory audit services