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Audit in Singapore


Audit | Bestar
Audit | Bestar

What is an Audit?


An audit is a systematic examination of financial records to ensure that they are accurate and reliable. In Singapore, audits are conducted by independent auditors who are qualified accountants.


There are two main types of audits in Singapore: statutory audits and voluntary audits.

  • Statutory audits are required by law for certain types of businesses, such as limited companies. The purpose of a statutory audit is to ensure that the financial statements of the company are prepared in accordance with the Companies Act and other relevant laws and regulations.

  • Voluntary audits are not required by law, but they can be conducted by businesses that want to ensure the accuracy and reliability of their financial records. Voluntary audits can also be used to obtain a third-party opinion on the financial health of the business.

The auditor will gather evidence to support their opinion on the financial statements. This evidence can include documents, such as invoices, bank statements, and contracts. The auditor will also interview the management of the business to understand the business operations and the accounting practices.


Once the auditor has gathered sufficient evidence, they will issue an audit report. The audit report will state the auditor's opinion on whether the financial statements are prepared in accordance with the applicable accounting standards.


The audit report is an important document for businesses, investors, and creditors. It helps to ensure that the financial statements are accurate and reliable, and it provides a basis for making informed decisions about the business.


Here are some of the benefits of having an audit in Singapore:

  • It can help to detect fraud and errors in the financial statements.

  • It can provide assurance to investors and creditors that the financial statements are accurate and reliable.

  • It can help to improve the internal controls of the business.

  • It can help to comply with legal and regulatory requirements.

If you are a business owner in Singapore, you should consider having an audit conducted on your financial statements. This will help to ensure the accuracy and reliability of your financial statements, and it can also provide you with peace of mind.


What Don't Auditors Do?


Auditors in Singapore do not do the following:

  • Authorize, execute, or consummate transactions on behalf of a client. Auditors are not a part of management, and they do not have the authority to make decisions about the business.

  • Prepare or make changes to source documents. Auditors rely on source documents to gather evidence about the financial statements. They do not make changes to these documents, as this could compromise their accuracy.

  • Assume custody of client assets, including maintenance of bank accounts. Auditors are not responsible for the safekeeping of client assets. They do not have the authority to access or manage these assets.

  • Give advice on business decisions. Auditors are not consultants. They do not provide advice on business decisions, such as whether to invest in a new project or hire new staff.

  • Guarantee the accuracy of the financial statements. Auditors cannot guarantee the accuracy of the financial statements. They can only express an opinion on whether the financial statements are prepared in accordance with the applicable accounting standards.

  • Detect all fraud and errors. Auditors are not perfect. They may not detect all fraud and errors in the financial statements. However, they are trained to identify and report on material misstatements.

If you are a business owner in Singapore, it is important to understand what auditors do and do not do. This will help you to have realistic expectations about the audit process.





What Can't Auditors Do?


Here are some things that auditors in Singapore cannot do:

  • Perform management tasks: Auditors are not part of management and cannot make decisions on behalf of the company. They can only provide an opinion on the accuracy of the financial statements.

  • Make changes to source documents: Auditors rely on source documents to gather evidence about the financial statements. They cannot make changes to these documents, as this could compromise their accuracy.

  • Guarantee the accuracy of the financial statements: Auditors cannot guarantee the accuracy of the financial statements. They can only express an opinion on whether the financial statements are prepared in accordance with the applicable accounting standards.

  • Detect all fraud and errors: Auditors are not perfect. They may not detect all fraud and errors in the financial statements. However, they are trained to identify and report on material misstatements.

  • Provide legal advice: Auditors are not lawyers and cannot provide legal advice. If you need legal advice, you should consult with an attorney.

  • Assume responsibility for the company's assets: Auditors are not responsible for the safekeeping of the company's assets. They do not have the authority to access or manage these assets.

  • Give advice on business decisions: Auditors are not consultants and cannot provide advice on business decisions. If you need advice on business decisions, you should consult with a business advisor.

It is important to understand what auditors can and cannot do in order to have realistic expectations about the audit process. If you have any questions about what auditors can and cannot do, you should consult with an auditor.


Here are some additional things to keep in mind about what auditors can and cannot do:

  • Auditors are required to be independent of the company they are auditing. This means that they cannot have any financial or personal ties to the company.

  • Auditors are required to follow professional standards when conducting an audit. These standards set out the procedures that auditors must follow in order to ensure the quality of their work.

  • Auditors are required to report any material misstatements they find in the financial statements to the company's management. If the misstatements are significant, the auditor may also need to report them to the company's shareholders or to the relevant regulatory authorities.

If you are a business owner in Singapore, it is important to understand the role of auditors and what they can and cannot do. This will help you to make informed decisions about your company's financial reporting.


How is the Audit Conducted?


The audit process in Singapore is conducted in accordance with the Singapore Standards on Auditing (SSAs). The SSAs are a set of professional standards that set out the procedures that auditors must follow in order to ensure the quality of their work.


The audit process typically involves the following steps:

  1. Planning the audit: The auditor will first meet with the company's management to discuss the scope of the audit and to identify any areas of potential risk.

  2. Obtaining an understanding of the company's business: The auditor will then gather information about the company's business, including its operations, financial reporting systems, and internal controls.

  3. Testing the company's internal controls: The auditor will test the company's internal controls to assess their effectiveness in preventing and detecting errors and fraud.

  4. Selecting and testing transactions: The auditor will select a sample of transactions and test them to ensure that they have been recorded correctly.

  5. Evaluating the financial statements: The auditor will evaluate the financial statements to ensure that they are prepared in accordance with the applicable accounting standards.

  6. Issuing the audit report: The auditor will issue an audit report that expresses their opinion on the fairness of the financial statements.

The audit process can be complex and time-consuming, but it is an important part of ensuring the accuracy and reliability of a company's financial statements.


Here are some of the specific audit procedures that may be performed in Singapore:

  • Inspection: This involves examining physical documents, such as invoices, bank statements, and contracts.

  • Observation: This involves watching how the company's employees carry out their duties, such as recording transactions or reconciling bank statements.

  • Inquiry: This involves asking questions of the company's management and employees to understand their procedures and practices.

  • Confirmation: This involves obtaining written confirmation from third parties, such as banks or suppliers, about the accuracy of the information provided by the company.

  • Analytical procedures: This involves using financial ratios and other analysis to identify unusual or unexpected trends or relationships.

The specific audit procedures that are performed will vary depending on the size and complexity of the company, as well as the nature of the business.


The audit report is an important document that summarizes the auditor's findings. The report will state the auditor's opinion on whether the financial statements are prepared in accordance with the applicable accounting standards. The report will also identify any material misstatements that the auditor has found.


The audit report is a valuable tool for users of the financial statements, such as investors, creditors, and regulators. The report provides assurance that the financial statements are accurate and reliable, and it helps users to make informed decisions about the company.




What do Auditors do, Specifically?


Auditors in Singapore perform a variety of tasks to ensure the accuracy and reliability of a company's financial statements. These tasks include:

  • Planning the audit: This involves identifying the scope of the audit, determining the materiality level, and developing an audit strategy.

  • Obtaining an understanding of the company's business: This involves understanding the company's operations, financial reporting systems, and internal controls.

  • Testing the company's internal controls: This involves assessing the effectiveness of the company's controls in preventing and detecting errors and fraud.

  • Selecting and testing transactions: This involves selecting a sample of transactions and testing them to ensure that they have been recorded correctly.

  • Evaluating the financial statements: This involves evaluating the financial statements to ensure that they are prepared in accordance with the applicable accounting standards.

  • Issuing the audit report: This involves issuing an audit report that expresses the auditor's opinion on the fairness of the financial statements.

In addition to these tasks, auditors may also perform other duties, such as:

  • Consulting with management on accounting and financial reporting matters.

  • Providing recommendations for improving the company's internal controls.

  • Investigating allegations of fraud or irregularities.

  • Preparing tax returns and providing tax advice.

The specific tasks that auditors perform will vary depending on the size and complexity of the company, as well as the nature of the business.


Here are some of the specific audit procedures that may be performed in Singapore:

  • Inspection: This involves examining physical documents, such as invoices, bank statements, and contracts.

  • Observation: This involves watching how the company's employees carry out their duties, such as recording transactions or reconciling bank statements.

  • Inquiry: This involves asking questions of the company's management and employees to understand their procedures and practices.

  • Confirmation: This involves obtaining written confirmation from third parties, such as banks or suppliers, about the accuracy of the information provided by the company.

  • Analytical procedures: This involves using financial ratios and other analysis to identify unusual or unexpected trends or relationships.

The specific audit procedures that are performed will vary depending on the size and complexity of the company, as well as the nature of the business.


Auditors in Singapore are required to be independent of the companies they audit. This means that they cannot have any financial or personal ties to the company. Auditors are also required to follow professional standards when conducting an audit. These standards set out the procedures that auditors must follow in order to ensure the quality of their work.


Auditors play an important role in ensuring the accuracy and reliability of financial statements. Their work helps to protect investors, creditors, and other users of financial statements from fraud and errors.


How Bestar can Help


Bestar is a Singapore-based accounting and auditing firm that provides a wide range of services to businesses of all sizes. They have a team of experienced and qualified auditors who are committed to providing high-quality services to their clients.


Bestar can help you with your audit in Singapore in a number of ways:

  • They can help you to understand the audit process and what is involved.

  • They can help you to prepare for the audit by gathering the necessary documentation and information.

  • They can conduct the audit in accordance with the relevant accounting standards and professional guidelines.

  • They can provide you with an independent opinion on the fairness of your financial statements.

  • They can help you to identify any areas of weakness in your internal controls and make recommendations for improvement.

If you are considering having an audit conducted on your financial statements, Bestar is a good option to consider. They have a proven track record of providing high-quality audit services to businesses in Singapore.


Here are some of the specific ways that Bestar can help you with your audit in Singapore:

  • Planning the audit: Bestar can help you to identify the scope of the audit, determine the materiality level, and develop an audit strategy.

  • Obtaining an understanding of the company's business: Bestar can help you to understand the company's operations, financial reporting systems, and internal controls.

  • Testing the company's internal controls: Bestar can help you to assess the effectiveness of the company's controls in preventing and detecting errors and fraud.

  • Selecting and testing transactions: Bestar can help you to select a sample of transactions and test them to ensure that they have been recorded correctly.

  • Evaluating the financial statements: Bestar can help you to evaluate the financial statements to ensure that they are prepared in accordance with the applicable accounting standards.

  • Issuing the audit report: Bestar can help you to issue an audit report that expresses your opinion on the fairness of the financial statements.

  • Consulting with management on accounting and financial reporting matters: Bestar can help you to understand the accounting and financial reporting standards that apply to your business. They can also provide you with advice on how to improve your financial reporting practices.

  • Providing recommendations for improving the company's internal controls: Bestar can help you to identify areas where your internal controls can be improved. They can also provide you with recommendations for how to improve your controls.

  • Investigating allegations of fraud or irregularities: If you suspect that fraud or irregularities have occurred in your business, Bestar can help you to investigate the matter. They can also provide you with advice on how to prevent fraud and irregularities from happening in the future.

  • Preparing tax returns and providing tax advice: Bestar can help you to prepare your tax returns and provide you with tax advice. They can also help you to comply with the relevant tax laws and regulations.

If you are interested in learning more about how Bestar can help you with your audit in Singapore, you can contact them for a consultation.


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