Statutory Audit

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About Statutory Audit

Statutory audit is one of the main types of audit which is required legally to review the accuracy of a company or government’s financial accounts. It is conducted with the purpose is to gather different information so that the auditor can give his opinion on the true and fair view of the company’s financial position as on the balance sheet date.

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Audit Compliance

Auditing of the books of accounts in compliance with the Statutory requirements for assuring true and fair view of the accounts under the compliance with the particular law condition under which the audit is initiated. For assuring true and fair accounts of the accounts and other statements integration of every account under the companies’ act, 2013 the accounts are compulsory to be audited by the Chartered Accountants. The auditor supervises and analyze every account in compliance with provisions and regulations of the Company Act 2013. Statutory is essential for assuring the reliability of the company’s annual accounts of various stakeholders like debtors, creditors, bankers, shareholders, and government.

The purpose of the statutory audit is to enable the Auditor to give his view independently without being influenced in any manner. He will check the financial records and will give his opinion thereon in the audit report. It helps the stakeholders to rely on financial statements. Stakeholders other than shareholders also get benefited from this audit as they can take their call based on the accounts as they are audited and authentic.

Advantages of Statutory Audit

It increases the authenticity and credibility of financial statements as the financial statements of the company are being verified by an independent party i.e., the auditor.
It confirms that management has taken due care while delivering their responsibilities.
It also states regarding the compliance with the non-statutory requirements like corporate governance etc.
The auditor also comments upon the strength of internal control within the organization along with internal checks among the departments or segments. He also suggests the area where internal control is weak and prone to risk. It helps the company to mitigate the risk and results in the improvement of the performance of the company.
The financial statement of the small company for whom audit might not be applicable get more values if it is audited one because with the help of the audited financial statements it becomes easier for the companies to get banking loan and other types of facilities on producing of financial statements which are audited by an independent auditor as the audited statements are more reliable and authentic.