An audit is a crucial part of any business. Generally, an audit is performed by internal parties, such as the Internal Revenue Service. The main goal of an audit is examining and verifying a company’s records in order to make sure that everything goes well within an organization.
However, not many people know when and how the history of auditing begins.
The existence of auditing was noticed in ancient cultures such as Greece, Rome, India and Egypt. The main mission of an audit was to collect information concerning financial systems; therefore, it became especially popular during the Industrial Revolution. During that revolution, the number of trading transactions was dramatically increased, which led to the expansion of business enterprises and fast growth of accounting systems.
Such changes had a huge impact on the development of the practice of auditing; however, in full consideration, auditing in its current form entered the business sphere in the 19th century.
The British Enter the Game
Thus, in 1880, the Institute of Chartered Accountants in England was established by a Royal Charter. Later, in 1923, the British Association of Accountants and Auditors started its operation.
After the stock market crash in 1929, the necessity of audits became vital. Hence, in 1933 the U.S Securities Acts were created to control the main stock exchanges in the United States. This part of the history had a huge impact on the development of auditing all over the world.
From this point, those organizations which were wishing to trade shares on the American Stock Exchange, had to issue their audited income statements. There was a designated person who was responsible for verifying the fairness of provided records.
In 1980, several changes were made in the process of auditing. So, auditors started to cut back their systems by implementing more analytical procedures, which led to the development of risk-based auditing. The main idea of a Risk-based auditing is focusing on areas which can contain more errors.
Nowadays, auditing is at its height and plays an important role in the operation quality of most companies. Millions of companies are seeking professional help in order to solve issues within their business. Even if your company has branches in different countries, you can still use the advantages provided by an auditor. That’s because a professional auditor can analyze the entire system of your operation, and detect any errors in their early stages.
The Future of Auditing!
Now that you have learnt most important parts of the history of auditing, let’s try to figure out what to expect from auditing in the future. Therefore, Prestige Auditors have conducted a thorough investigation of this practice in order to predict the main changes in this segment in the future.
We think that the popularity of internal audits will continue to grow faster, since, as practice shows, most companies prefer to use exactly this method of auditing by hiring an auditor who will provide them with comprehensive feedback concerning all the shortcoming within their business.
IT audit will remain to stay one of the most important factors, since both automated processes and systems are continuing to play an important role in the market. If you intend to start an online business, then we suggest you read this blog about supply chain audit.
Compliance is another important part in auditing which is also going to grow in the next few years. That’s because the compliance manager is responsible for such important parts of the business like the compliance of the company and its employees with regulations established by the Securities and Exchange Commission. You can also read this blog, where we talk about different types of audits.
Auditing is a vital part in every business, since it can help you not only detect and liquidate all the errors within your business, but also understand your company’s financial and operational goals. Additionally, by working with a professional auditor, you can also make sure whether these requirements are being implemented in compliance with all regulations.
If you intend to start a business, but are not sure whether your investments are going to fly or not, then, we are here to help you. The entire team of Prestige Auditors consists of professional attorneys and tax experts who can analyze your business and come up with a comprehensive report of your business, stating its strengths and weaknesses. Additionally, we will help you file your taxes by taking full responsibility for the boring process of collecting records. By working with us, you can be sure that the engine of your business works without any errors. Visit our website, and you will find detailed information of services provided by Prestige Auditors.