ITR filing GST filing Accounting outsourcing services

What Auditor should know about client?

Obtaining an understanding of the client’s business is key to an effective and efficient audit. Our knowledge of the client’s business also helps us to develop and maintain a positive professional relationship with the client. So following are important factors which should be known by auditor about their clients.

 1. Describe the internal factors affecting the business, including

  • Business objectives and operations (including key income earning assets)
  • Ownership and management structure, including the relationship between the owner
  • and the entity, if applicable
  • How the entity is financed
  • Key personnel
  • Selection and application of accounting policies
  • Taxation status and issues of the entity and owner, if applicable
  • Taxation and reporting requirements

2. External factors including, industry and general business environment; competitive benchmarking; and laws and regulations which have a fundamental impact on operations.

3.  Management's risk assessment process - the process used to identify, analyze, and manage the risks faced by the entity.

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