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Understanding the Difference Between Audit and Assurance Services in Malaysia
Both audit services and assurance services are crucial in evaluating the financial records of a company. They each follow a distinct procedure to not only verify accounting records but also ascertain their accuracy. What's more, both services help ensure that all records follow the current accounting standards.
However, despite their similar goals, there are distinct differences between the two accounting services.
Audit services evaluate a company's financial statements and judge their authenticity and accuracy. "This process involves acquiring accurate financial statements from the company ethically and fairly. Once the auditor receives the necessary data, he or she will assess it and identify false entries, if there are any. This includes fraud and misuse of funds," stated Mr Jason Wong, Accounting Team Leader at Bestar Consulting.
He further added, "In order to ensure the validity of the information, the documents must go through internal and external auditors. Internal auditors are employees of the company and oversee the risk management policy, while external auditors are independent individuals who provide their expert opinion on the financial statements."
Not only does hiring an external auditor reduce the risk of overseeing mistakes, but it also removes potential biases an internal auditor may have when evaluating the documents and preparing reports.
While audit services refer to the task of identifying fraud or misuse of funds and correcting them, assurance services deal with enhancing financial statements. In other words, assurance services specialise in examining the documents and making quality improvements to protect the company's financial stability.
Through this, assurance services can enhance the company's transparency, relevance, and value of financial information. With the improvements in financial records, business leaders can therefore make better and more well-informed decisions to grow their business.
With that, it's clear to see the distinction between audit and assurance services in terms of managing the company's financial statements. They work in tandem to ensure that companies provide accurate and authentic financial information that abides by statutory guidelines. Based on that information, auditors can enhance financial operations to help companies obtain the maximum results.
Bestar Consulting is a leading financial firm that offers audit and assurance services to ensure that companies comply with accounting standards, achieve a stable financial positioning, and improve overall operations. You may visit https://bestar.com.my/
+60 3 23893099