As a small business owner in Singapore, facing your first audit can seem daunting. However, with proper preparation, it can be a smooth process that provides valuable insights into your business operations. At Counto, we’re here to guide you through this important milestone.
In Singapore, certain companies are required by law to undergo annual audits. Even if your business isn’t legally required to do so, voluntary audits can enhance credibility with stakeholders and help identify areas for improvement.
1. Organise Your Financial Records
Maintaining well-organised financial records throughout the year is crucial. This includes:
Example: If you’re a retail business, ensure you have a clear record of all sales transactions, including those from your physical store and e-commerce platform.
2. Reconcile Accounts
Ensure all your accounts are reconciled. This means your bank statements should match your internal financial records.
3. Review Previous Years’ Financials
Compare your current year’s financials with previous years. Be prepared to explain any significant changes or anomalies.
Example: If your revenue has doubled but your expenses have remained the same, be ready to explain how you achieved this efficiency.
4. Prepare a Fixed Asset Register
Create a comprehensive list of all your company’s fixed assets, including their purchase date, cost, and current value.
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5. Document Your Processes
Have clear documentation of your financial processes, including how you handle cash, manage inventory, and process payroll.
6. Gather Supporting Documents
Collect all supporting documents for your financial transactions. This might include:
7. Review Compliance
Ensure you’re up to date with all regulatory requirements, including:
8. Prepare Your Team
Brief your team about the audit process and ensure key personnel are available to answer questions.
9. Address Previous Audit Findings
If you’ve had previous audits, review the findings and be prepared to show how you’ve addressed any issues raised.
10. Engage with Your Accountant
While Counto doesn’t provide business audit services, our expertise in maintaining accurate financial records is invaluable in preparing for an audit. We can help ensure your books are in order and assist in preparing the necessary documentation. Learn more about our accounting plans here.
A well-prepared audit can:
Preparing for your first business audit may seem challenging, but with proper organisation and the right support, it can be a valuable experience for your Singapore SME. By maintaining accurate records, understanding your financials, and ensuring compliance, you’ll not only be ready for the audit but also gain insights to improve your business.
Counto is the trusted provider of accounting, tax preparation and CFO services for startups and SMEs. Get accounting plans that combine bookkeeping with corporate tax filing to help you stay compliant at an affordable price. To learn more, speak to us directly on our chatbot, email us at [email protected], or contact us using this form.
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