The current situation requires companies to follow up and advise good professionals. Although the ideal is for every company to have one auditing or accounting consultancy since its opening, we have experienced a moment of urgency that may define the survival or profitability of companies that do not yet have them. There are great chances of success and continuity with the help of financial planning, advised by a professional in the area of auditing.
That's because the professional of auditing has the necessary knowledge to direct leadership, helping to adjust financial management by providing information on costs, financial indices, and tax charges, for example. In addition, through a process of auditing, the accountant also provides his opinion on the company's real financial health, generating indicators that facilitate planning and decision-making.
The COVID-19 pandemic created new challenges for auditing, which, if not taken into account, may have an impact on the quality and reliability of the auditor's work. In addition, some fieldwork at auditing provide a critical basis for forming your opinion, such as inventory counting, real estate verification, and asset inspection, which are not feasible to carry out virtually. In these cases, the scope of auditing in normal times, it would entail several days or weeks at the client's location, with the auditing team carrying out the tasks. Companies then need to start planning their auditing more in advance, for example, companies that do inventory counts on a continuous, rather than an annual basis. Companies that carry out annual inventories, on the other hand, need to consider the following questions, so that they are prepared for their auditing: What will the inventory be like in a pandemic context? Will the team be able to maintain social distance and adhere to COVID-19 policies pertaining to your business? If fewer people need to use, will it take longer to count the inventory? If so, what will be the impact on operations?
The crisis created additional challenges for auditing also for the preparation of financial statements, as solid information is needed about the impact of COVID-19. The pandemic has had an enormous impact on organizations and leaders are faced with uncertainty regarding future prospects. In this case, the auditing has a large and complex responsibility in the reporting chain, including reliable and relevant information, since the level of uncertainty impacts the assumption of management continuity. Companies will also need to disclose additional information in their reports regarding the impact of the pandemic and this will require more attention from auditing, increasing its execution in length and relevance.
During the pandemic, changes may have been made to the company's governance, processes, and systems, resulting in a greater likelihood of fraud, and companies are already facing increasing pressure to identify financial fraud. The assessment of these changes will be part of the auditing and have a professional from auditing accompanying the company can guarantee business success.
A auditing you may also face difficulty obtaining evidence because you are not on site or face additional challenges in evaluating their suitability and reliability, in which case you will need to discuss the topic with the leaders. If the evidence of auditing cannot be obtained sufficiently, this will have an impact on the reports. In this case, the auditing may take longer than in previous years, requiring adjustments in supervision and review of procedures.
As in any crisis, the COVID-19 pandemic will expose flaws and inadequate methods, as well as create opportunities for people in bad faith to commit fraud. However, for auditing, the pandemic also offers the opportunity to reinvent its role and focus on useful and efficient methods for the future. Despite the complexities, the professionals of auditing continue to focus on high-quality audits, in full compliance with established standards and norms.
Contact TATICCA — ALLINIAL GLOBAL, which operates throughout Brazil and globally, with integrated auditing, accounting, tax services, corporate finance, technology, Risk Advisory, business consulting and training. For more information, visit www.taticca.com.br or email taticca@taticca.com.br and learn more. Our company has professionals with extensive experience in the market and has certified methodologies for carrying out activities.
