DISCOVER 7 ADVANTAGES OF PERFORMING INTERNAL AUDIT IN YOUR COMPANY

 

Compliance is no longer an ideal and has become a reality in many United Arab Emirates companies. More and more managers understand the need to take measures to find and combat unethical behavior  and corruption in organizations. However, it is still common for there to be confusion between these processes and internal audit.

Even some industry professionals ( compliance officers  and auditors) often confuse the areas, believing that just one of them is enough. Hence the importance of delimiting the performance of these functions. Both are essential for the smooth running of the company and, therefore, must be carried out separately.

In this post we explain what an internal audit is and what are its 7 main advantages. Read on and find out why you should do it in your business!

After All, What Is An Internal Auditor In Uae?

It is an independent activity, the objective of which is to add value to the company, through an evaluation and consultancy work. Internal audit is an objective, systematic process, used to assess corporate governance, the use of internal controls and risk management.

Its purpose is to assess the organization in a systemic way. The audit verifies whether the controls adopted are sufficient to resolve operational problems and threats, among other issues that can damage institutional efficiency and image.

WHAT IS THE DIFFERENCE BETWEEN AUDITING AND COMPLIANCE?

First of all, we must understand that compliance  means being in compliance with something, be it a law, a rule or an internal regulation. Thus, it consists of an attitude, a way of acting or a set of actions that involves all those belonging to the organization.

Thus, we cannot say that internal audit and compliance are the same, but that they are complementary. After all, both seek the best functioning of the company.

However, compliance is involved with the definition and establishment of rules, risk management and the awareness of employees and managers. While the audit seeks to analyze the controls and processes used, seeking to identify points for improvement or that generate growth opportunities, detecting irregularities in the organization.

In other words, compliance is concerned with implementing fraud detection and prevention tools. The internal audit, on the other hand, checks whether these standards are being well applied, according to samples and punctual and scheduled checks.

Another fundamental difference between compliance and internal auditing is the involvement of managers. If, on the one hand, they actively participate in the process of establishing rules and standards, on the other, they must be left out of the audit, in order to guarantee the exemption of the process, even if they are responsible for it.

Finally, it is also worth noting that the audit can be considered a response to the risks to which the company is exposed. Because internal controls must ensure that the organization is in compliance with the law. That is why, although they are not the same thing, they are codependent activities.

WHAT ARE THE ADVANTAGES OF CARRYING OUT THE INTERNAL AUDIT?

Given these concepts, we can now talk a little about the benefits of internal auditing. Obviously, they can vary according to the size, the area of ​​operation and the peculiarities of your organization. But in general, we can highlight the following 7 advantages.

1. Ensures the use of controls

The first advantage is related, precisely, to the application of internal controls. There is no point in investing in their implementation if they are not used well, as this way, it will not be possible to achieve the expected results. Thus, internal audit is a process of verifying the instruments used to control the company's processes, whatever they may be, and their effectiveness.

2. Check the application of policies

Likewise, internal policies must also be followed to the letter, not only serving as an ideal. The audit has the mission to reveal how much they are being respected and put into practice, as well as their effects on the organization's routine.

3. Evaluates the effectiveness of the standards

In addition to policies, standards must also be verified. While compliance is in charge of determining which ones are pertinent and creates means for inspection, the internal audit must certify if they are being met. In other words, together, these two instruments are fundamental for ensuring compliance, avoiding fraud and other problems arising from unethics or  corruption.  within the organization.

4. Anticipates and seeks to solve problems

In assessing policies, controls and standards, the audit is able to identify real or potential problems that may put the company at risk. So it is a way to prevent these problems from arising and, at the same time, to minimize their effects. It is good to remember that such occurrences can be quite harmful if they are not resolved in time, since they have already been subjected to a whole previous process of  analysis of compliance risks .

5. Identifies possibilities for improvement

The audit does not serve to identify only problems. On the contrary, it is easier to find points that can be improved or contribute to the growth of the company. That is why it is usually carried out before major changes, such as a merger or acquisition process.

6. Increases the reliability of the company

Like compliance, internal audit is a way to increase the trust of customers, suppliers, employees and others involved in the business. It is a way to seek transparency and maximum efficiency in processes, showing different audiences how important this is for the organization.

7. Contributes to decision making

Finally, it is important to highlight how much internal audit contributes to decision making, not only by pointing out opportunities. The fact is that having an external view - since managers do not participate in it - is a way of going further, of perceiving and foreseeing different scenarios and possibilities, something so important for decision-making.

Finally, the internal audit is the ideal tool to identify the effectiveness of all forms of control and the use of the proposed rules and policies. Therefore, it is worthwhile to know a little more and carry out this type of activity in your business.

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Complete guide: How to open a company?

 

Just as you probably want to start a business , people around the world also dream of following the path of entrepreneurship. However, in the face of many demands and costs, this dream can end up becoming a nightmare for many, who end up giving up halfway or decide to skip some important steps in the opening process.

 As you may have noticed, having your own business is not an easy task, since most ventures require qualities that only an excellent professional possesses, but for those who accept the challenge, check out the step by step how to open a company and be ready for success. Prepared?

 What do you need to know before starting a business?

 Becoming a boss is the goal of many people, however, starting a company and making it a reality is not an easy task. In order to be an entrepreneur, in addition to the duties and responsibilities that the position requires, several skills are essential to make the venture work .

 First of all, you must ask yourself: is this investment a good deal? What are the risks? Do I have the ideal profile to lead? These are questions that you must answer sincerely and be consistent, your answers will be the starting point for opening a business.

 In addition, it is necessary to define which segment your company will operate in and whether it will be adequate to the demands of the market. In other words, to start a business you will need to plan ahead.

 Speaking of planning, it is good to have an action plan in mind, it will be responsible for defining the costs, the available resources, the main goals and objectives. Before taking the idea off the paper and putting it into practice, you need to find a strategic location for your company and identify the target audience that you intend to reach with the new business.

 How do I know if I'm ready for a deal?

 For some companies, courage is not lacking when starting a business, however, it is not always enough to keep an enterprise running. It is therefore essential to assess the right time to take the first step in the business world.

 Taking a conscience check is a smart move. In order to start a company, some skills are important and acting impulsively is not a good way to start things, since the best way is to know the job market and know the business strategies.

 Many entrepreneurs, who are just starting out, end up risking the business, without first knowing how to make decisions, make good planning, deal with employees, among others. Before “sinking your own boat”, try to know if you are prepared for this new phase.

 Where to start the opening of the company?

 To start a company, the future entrepreneur will face some bureaucracies that are part of the beginning of any business. Many complaints are made because of these requirements, but they are fundamental to the recognition of your activities and to ensure that your company does not receive an unwanted visit from an inspector in the future.

 And what are all these requirements?

 It is necessary to formalize your company, to define the legal nature, for that you will need to gather several documents and pay fees and taxes for the legalization of your business.

Before starting to think about opening a company, you must have a (National Register of Legal Entities). This document represents that your company is registered with the Ministry of Finance and Federal Revenue.

 But, if you have no free time to pursue these requirements, there is the possibility of taking the through the internet, through an application made available by the IRS. If you feel insecure in relation to the choice of regimes and frameworks of your company, there are accounting companies that offer assistance for starting companies registration. The right choices at the beginning can generate savings and bureaucratic optimization for your business.

 Social contract

 The social contract is a document that you may need more than once, to prepare it you can count on the help of a lawyer, who must also register it with a notary.

 The document must contain the name of the company, the value of the initial capital and the names of the owners of the business. This record is important to classify the type of segment of the initial business and what are the amounts of taxes that will be charged.

 State registration

 If the company you are opening operates in the trade, industry, transport or communication and energy services provider, State registration is mandatory. The other companies that provide services are exempt, but they must still contribute with another tax: ISS (Tax on Services).

 Banks, hospitals and laboratories are examples of companies that are exempt from state registration. But if the company provides outsourced services and also sells products, it will have to pay both taxes.

 Commercial Board

 The commercial board is the body whose function is to register the activities related to the different branches of companies in the country. Each United Arab Emirates state has its own board, which is also responsible for issues such as the issuance of judicial letters, certificates and registration forms, for example. example.

 For the opening of a company, you will also need the City Hall's operating permit. Generally, only registration with the IRS, the social contract and personal documents are charged.

 It is also essential to obtain the Health Surveillance and Fire Department Permit. Requirements that are fundamental in any location, to ensure everyone's safety - especially if your company operates in the food industry.

 How to make a business plan?

 With the legal issues already resolved, we can begin to put together a business plan. But what is this? The business plan is a roadmap used by new entrepreneurs.

 Its purpose is to plan, in the short, medium and long term, all the necessary actions for good business results. Tracing this planning is essential to conquer your space in the market.

Read also:  Internal audit: reasons for your company to put into practice

 

 

Read also:  5 golden reasons for you to become a business consultant

 

 

Read also:  ERP Business Management Software - Accounting System

 

 

Read also:  Advantages of having an accounting integrated with the ERP system

 

However, with the absence of the business plan, a company can close before it even starts. But, so that it doesn't happen to you, here's how to assemble yours:

 Market analysis

 As a good entrepreneur, you can't count on just luck to start your business. It is essential to know in detail the preferences of your target audience and the strategies that competitors use.

 The best way to obtain this information is to do market research, analyzing the products and services that competitors offer, in order to find inspirations or ways to overcome them in their deficiencies.

 Another way to analyze the market is to research consumer preferences and behavior. It is the ideal time to understand the needs of customers and how they can serve them.

 Defining strategies

 It is good to start thinking: how will your objectives and goals be achieved? How will your company be publicized? Having an idea is easy, however, it is necessary to know how to put it into practice to achieve better results.

 Therefore, in order to define strategic planning, everything your company needs to exist must be placed at the tip of the pencil, what actions must be taken so that the competition is overcome, how to make it attractive to customers and how to consolidate itself in the market.

 Financial planning

 To calculate the costs of an initial investment, you must take into account all fixed investments, working capital, investment in operational services (equipment, labor, etc.) and income statement with the profits obtained from the services provided.

 When opening a company , the results take time to appear. But with the financial plan, you balance your billing so you don't lose out and allow you to calculate the time it will take to get a positive return.

 After knowing about the profits that will be obtained, make your annual projections and remember to be in line with the accounting standards that are required.

 How to define the best tax regime?

 Right at the beginning of your business you need to decide what is the best tax regime for paying taxes. This decision is of great importance, so it is necessary to know the systems well so that you do not end up paying additional fees to the government.

 Most of the time, entrepreneurs hire accountants to resolve this issue. But, if you know the behavior of the market well and each one of these modalities, you will be able to decide which tax regime is more appropriate when opening your company.

 Learn more about this subject: Real Profit or Presumed Profit? Which one is the best?

 How to register a trademark?

 It is obvious that you know big companies whose brands are recognized worldwide. In addition to talent and entrepreneurial spirit, these companies have a fundamental: the legal registration of their identities.

 It may seem simple to create a name for your company, but you may experience complications if you copy an existing name or have the name copied.

 To avoid these inconveniences, it is best to know how to register a trademark. Thus, you acquire exclusivity and still have greater chances of promoting yourself within your segment, since that way your company will be seen from a new corporate angle.

 Check if your brand has already been registered

 It is common for entrepreneurs to think of common and similar names and this is one of the causes for many companies to register their brands: not to be copied.

 The first step to be taken is to search for brands that already exist in the market. This research can be carried out by anyone in a practical and free way.

 Determine the brand type

 Trademarks can be nominative when they are made up of words; they can be figurative, which occurs when accompanying symbols; and they can also be mixed, where there is a mixture of words and symbols.

 Pay an upfront fee

 When starting a Business Consultant in UAE, all processes require costs, even to register a trademark.

 See the costs of this operation and remember that small companies have discounts of up to 50% in fees. It is also necessary to pay for the exclusivity of the brand, being valid for up to 10 years.

 How to get customers?

 After all the bureaucratic process, your company may open its doors, but the principal is still missing to complete your mission. It is the customers, the key part for any enterprise to succeed.

 Conquering customers, especially at the beginning of the company, is a task that requires marketing and sales strategies. With the market becoming increasingly competitive and selective, it is not worth waiting for your company to receive the visit of customers from one moment to the next.

 So, check out some tips on how to get desired customers for your company:

 Determine your target audience

 Knowing who your customers will be is essential to meet your needs. However, not all people in the world can become your customers. On the contrary.

 The more segmented your business is, the more targeted your customer base will be. You must profile your audience and research preferences, it is also worth researching how the competition serves this same target audience.

 Determine marketing strategies

 Calculate the capital available for marketing actions and make a monthly disclosure plan.

 In addition to social media, you can invest in pamphlets, advertisements in newspapers and magazines, advertisements on billboards and, mainly, in digital marketing strategies. After all, customers need to know and never forget your company.

 Prepare your team

 Your team must always be prepared to offer the best service, as soon as the first customer crosses your door.

 And the best way to obtain this preparation is to invest in constant training on the products and services that your company offers. Don't forget to also allow them to offer discounts and possible gifts, attracting the customer and earning their loyalty

 Make partnerships

 Think of strategic establishments that can contribute to the promotion of your company. These alliances offer several advantages, such as new customers contacting suppliers. After all, alone nobody gets anywhere.

 After this complete guide your company and you are prepared to face the market. Nothing better than being aware that getting here is not easy. Now, with the right information, you can start your dream and succeed in your venture!

 Financial auditing is a practice that is gaining more and more space and importance within companies. In view of today's fierce competitiveness, using effective tools for evaluating and controlling all the activities of a business , especially in the financial sector, is one of the basic requirements to guarantee its permanence in the market.

 Reducing  - and, preferably, reaching the point of eliminating - errors and fraud, controlling your finances efficiently and constantly evaluating your practices are ways of working for a company to continue to exist and gain its market share for a long time.

 This is where financial auditing helps. By systematically analyzing how organizations do their internal control, auditors become an important source of reference for managers , showing problems and critical points of a company's routines.

 In this article, we will clarify how a financial audit works and explain the steps necessary for its performance, highlighting its importance to  increase efficiency  through control and continuous process improvement. Are you interested? So, read on!

 1. What is financial auditing?

 Financial auditing is a branch of accounting that specializes in systematically and impartially checking the consistency of facts and information recorded by the financial area. To audit a company's finances is to study its financial statements and make sure they are in accordance with current accounting principles.

 It will verify the existence of problems and risks in any financial activity of the company, identifying the reason for their occurrence, the moment in which they were consummated and outlining ways to eliminate them. All of this aims to assess whether all procedures respect the legal and ethical requirements that the company must comply with.

 The financial audit therefore works as a kind of quality control - since it implements mechanisms that provide security about the financial, legal and organizational status of the company.

 2. How did it come about?

 The first historical records of audit-related activities date back to ancient times. That's right! By the year 4,500 BC there were already people concerned with checking the consistency between the records and the facts.

 Throughout antiquity, it is possible to observe examples of financial Auditors in Dubai. The Romans, for example, had an improved audit system to serve as an instrument for controlling the empire and public accounts.

 Many  family businesses  had to become professional and seek resources to keep their products and services competitive in an increasingly competitive market.

 3. What factors drove your growth?

 This movement was important to make the control of finances more transparent and professional. However, modern accounting and auditing have come a long way since the beginning of the last century.

 In addition to the development of the economy and the change in the profile of market players, many other phenomena have also given impetus to its practice.

 A good example of this was the creation of the Security and Exchange Commission in 1934 in the United States. The entity's mission is to increase the reliability of financial information and records provided by companies that trade securities on the stock exchange to safeguard investor interest and increase the transparency of operations.

 Another factor that contributed to the development of financial auditing was the implementation of Keynesian economic policies in the period that followed the 1929 crisis. The creation of a strong and interventionist state meant that companies had to undergo a series of new tax obligations. .

 The audit, therefore, became important also to ensure that the company operates within the limits imposed by the laws and regulations issued by the Government.

 In addition to bearing a greater tax burden, in order to sustain the so-called “welfare state”, companies have also undergone more intense regulation - which imposed a series of ancillary obligations, such as the issuance of  invoices  and the maintenance of financial and accounting books.

 In United Arab Emirates, financial auditing came to be seen as an essential tool for good  management , especially after the second world war - a time when the United Arab Emirates economy was gradually opening up to multinationals.

 With them came the big accounting offices, which already worked with these companies abroad and were already used to the levels of transparency practiced in the international market.

 To have an idea of ​​the importance of the topic today, suffice it to say that,  according to research , about 70% of all United Arab Emirates companies have already been victims of fraud. It is estimated that around R $ 2.2 billion are stolen by employees in commerce every year. Unfortunately, small businesses suffer the most from these numbers, which do not have a robust accounting structure.

 Both the fight against fraud, tax compliance and internal and external transparency are very important elements for the company to maintain its financial health, an essential item for its growth.

 In addition to making the investor feel more secure, facilitating fundraising for the business, audits are also important to reduce the likelihood that the company will be fined by the inspection authorities, having to bear heavy fines or even with the establishment ban.

 4. What is a financial audit for?

 The financial audit has the role of identifying the complications, facts and accounting risks that affect the company's equity so that, in this way, it can present an opinion on the efficiency and quality of the company's internal controls.

 Only by constantly monitoring all monetary values ​​related to the activities carried out in the company will it be possible to develop and apply  strategies to optimize resources  and, consequently, operational fluidity.

 The audit will therefore be responsible for monitoring all activities that involve treasury and cash flow (accounts payable and accounts receivable). The auditor assesses whether the financial sector carried out all transactions correctly, lawfully and in accordance with the company's internal rules.

 This observance, on the part of the auditor, about the financial statements and their compliance with the regulated accounting principles and requirements is fundamental so that the use and targeting of resources is carried out in a uniform and advantageous way for the company.

 5. How to perform a financial audit?

To perform a financial audit, it is necessary to follow a script that goes from the identification of the company's processes and routines to the evaluation of the results and the suggestion of improvements by the accountant.

 The step-by-step below identifies the steps of an audit and gives  tips on its applicability. Check out!

 5.1. Mapping processes

 Financial audit work should begin with mapping existing processes in the financial sector. This means listing and identifying all financial practices carried out by the company and which are the responsibility of the financial department. This includes, for example:

• cash flow management;
• payment to suppliers;
• administration of accounts payable and receivable;
• the collection of delinquent customers;
• Reconciliations and bank transfers.

The goal is to condense and lay out all of these procedures on a task map. This measure makes the flow of all financial processes clearly visible.

 5.2. Identifying risks

 With the mapping ready, the second step is to analyze each of the routines registered there. The objective is to study how the action is being carried out and to identify the existing risks.

 Therefore, a thorough analysis of each task must be carried out, looking for errors and inconsistencies that are not in accordance with the recommended by accounting standards.

 When making this identification, it is important to check the cash flow activities and ask the area manager about the level of perception he has regarding the risk of the sector's activities.

 5.3. Identifying internal controls

 After identifying the risks that exist and their possible impact on financial processes, the next step is to assess whether the company has an internal control system that can minimize them.

 In other words, here it is verified what tools are used to ensure that your daily financial activities do not present problems and flow according to the plan. There are several types of Internal Audit and control system reviews in UAE, each with its peculiarities and specific functions, such as:

• financial reports;
• contracts;
• spreadsheets;
• approvals;
• electronic authentications;
• casualties;
• reconciliations;
• revisions;
• Stamps.

 As an example, let's look at a supplier payment routine. After checking how a company pays its suppliers, we identified that one of the risks that exist in this process is that of making a double payment. The audit will ask the following questions:

 “What internal control does the company do to minimize this risk?”;

"Is it already in place?"

 In this specific case, a good internal control practice would be a payment reconciliation system followed by a cash register that demonstrates, in a clear consultation form, that the payment has already been made.

 It should be noted that all internal controls in the financial sector are focused on accounting. Also considered as internal controls are the tools that assist in the day-to-day operations of the sector, such as:

• fraud protection systems;
• default prevention;
• Routines and guarantees against theft.
• Any other measure that helps to ensure financial security.

 5.4. Testing internal controls

 Knowing what the company's internal controls are and how they work, the audit will now have the mission of testing them in practice. The purpose of this step is to check the efficiency level of these controls, finding out if they can minimize the identified risks satisfactorily.

 Based on specific techniques and procedures, the audit will put each of the controls to the test, analyzing whether the process is, in fact, being followed as expected and what is its level of security.

 If the auditor finds that internal control is not efficient or is not put into practice, he must list all the problems encountered and verify their impact - not only in the financial sector, but in the company as a whole.

 5.5. Analyzing the results

 Repeating this process in all the company's financial routines, the audit gathers the evidence and the results obtained. In positive evaluations, the auditor informs in his report that the process is effective and recommends its maintenance.

 Read also:  Internal audit: reasons for your company to put into practice

However, when verifying that a certain routine is wrong, it is the task of the audit to point out exactly where the problem is, informing how and why it is happening. At the end, the auditor concludes his work suggesting the best practices to solve it and how they should be implemented.

 What every manager should keep in mind is that the intention of a financial audit is not just to point out mistakes and culprits. Unfortunately, this is still a common thought, considering that an audit is usually only performed after failures in  financial routines  have already caused some damage.

 The audit should be valued and seen much more as a preventive action, applicable periodically and continuously within a company. Its results benefit everyone because:

• guarantee the sustainability of the business;
• improve profit margins;
• decrease the risk of errors;
• Make employees feel more secure.

6. Why is it so important to perform a financial audit?

In addition to the fact that conducting a financial audit is a vital task in improving the way a company manages its money, it also fulfills the role of preventing and combating fraud, scams and theft within an organization.

Often, small losses may seem insignificant for business, but the final sum represents  large losses  - financial and credibility - when such behavior is not reprimanded and shunned.

The financial audit will then be essential for it to be possible to identify and verify the risks of distortion that have occurred in the company.

 Read also:  Discover 6 types of audits that can help your company

In addition, the audit will allow a greater understanding of  the financial reality  and organizational effectiveness - which ensures improvements in the entity's internal control and, consequently, a solid basis for planning and executing practices that will correct the errors and deficiencies identified by the auditor financial.

All this care guarantees much more than the reduction of errors and the elimination of risks. Auditing is also a great strategic ally for any business that wants to have a more effective financial sector and, with that, grow safely and without inconvenience involving tax complications.

7. Controllership and auditing: what is the relationship?

Many people who do not know accounting closely confuse or treat the concepts of controllership  and auditing as synonyms  . The confusion is justified: after all, the two activities are very similar.

However, the two expressions represent totally different things! We can say that controllership (despite being a branch of accounting) is a little closer to the organization's management, since its performance is focused on the company's financial future.

 This is, therefore, one of the biggest differences between the two. The audit, considered in isolation, generally limits its scope of analysis to the past - that is, to sales that have already been made, to taxes that have already been collected, to payments that have already been made, etc.

 Controllership, in turn, looks forward to anticipating the challenges that the company may encounter in its path. It is worth saying, therefore, that the two activities do not cancel each other. Quite the contrary: they are complementary!

 8. Financial audit and accounting audit: what is the difference?

 In its origins, the audit was born within the financial department. However, it proved to be such an effective means of examining the company's activities and ensuring the implementation of the planning that it even gained popularity in other sectors of the organization. This is what happens, for example, with accounting auditing .

 As its name already indicates, an accounting audit aims to analyze accounting and non-financial documents. Thus, its objective is to validate the accounting balances  - which is done by comparing the entity's financial statements with its equity, economic and financial situation.

 One of the biggest advantages associated with accounting auditing is the evaluation of the company's internal controls, ensuring that the accounting records do, in fact, reflect reality and not a fiction fueled by time with errors and fraud, for example.

 Read also: Internal audit: reasons for your company to put into practice

Without reliable information at hand, it is much more difficult to run a business. Not to mention that the trend is that the pressure on managers will increase, since the  partners  or shareholders will also not feel safe with the unaudited financial statements.

 9. Internal audit and external audit: when to use one or the other?

 In general, the internal audit aims to draw conclusions and generate reports directed to the company's own management. The external audit, in turn, aims to attest the veracity of the records to third parties.

 These third parties may include investors, minority partners, the government or financial institutions - for purposes of credit approval, for example. In that case it is important to choose an impartial accounting firm to stay ahead of the process.

 Finally, we could not close the article without emphasizing the importance of controls and audits in the company's finances, since errors and fraud can be expensive - besides, of course, exposing the organization to fines and sanctions provided for by law.

 Furthermore, as we have seen, conducting a financial audit on the company is not difficult when we follow some fundamental steps! It is also worth remembering that the manager should not feel alone on this journey. Partnering with accounting firms and management consultancies can be the best way!

How to prepare your company for an audit

 

Now that you know how auditing can help your company and the main areas that can be audited, let's talk a little bit about how to get your company ready to receive Auditors in Dubai.

 1. Insert in the annual plan

 A very efficient way of not failing to audit the various sectors of your organization is to insert the activity in the annual plan.

 Thus, everyone knows in advance what the intentions of the company's management are.

 2. Have clear goals

 It is very important to involve all employees in this process. One way to do this is to share with all the reasons that led the audit and what questions are expected to be answered.

Read also: All about internal audit: what it is, benefits, when to do it and how to prepare

 3. Formalize the processes

 In addition to involving employees, the role of each person within the company must be made clear.

 Therefore, investing in training, being always available to talk and offering constructive feedback makes all the difference!

 4. Know what's best: internal or external audit

 During the text, we talked a lot about the purpose of audits. Therefore, before hiring a company or preparing a team to audit the company, know what result is expected from it.

 Reinforcing the concepts: internal audit serves to assess and survey data, while the external one will attribute credibility.

 We hope to have answered all your questions about auditing and why this is an important activity for your company, regardless of size.

 Read also: ERP software rental vs. ERP software purchase

Keep following our blog for more discussions like this. Subscribe to our newsletter and don't miss the news.

What is ERP and what can it do for your company?

 

There are many moving parts when running a business. In this scenario, you: run your daily operations, manage your sales, pay your employees on time, supervise your inventory, file your taxes, manage your production and supply chain and last - but not least - keep your customers happy and coming back . In other words, ERP software makes managing your business much easier.

 So, what is ERP exactly? ERP means enterprise resource planning. In other words, in its most basic form, it is a single system that integrates all the essential processes necessary to manage a company.

 An ERP system is made up of enterprise resource planning applications that communicate and share a database. Thus, each application, often called a software module, generally focuses on one area of ​​business. Finance, human resources, sales and logistics are popular starting points. In addition, there are specific modules for a wide range of industries - from wholesale and manufacturing to retail and e-commerce.

 Most enterprise resource planning systems have simplified automation and reporting capabilities. This helps companies to operate more efficiently and better comply with compliance regulations.

 Because each ERP application is connected and shares a common interface, different business units (for example, sales and finance) can work from data that shares a single source of truth - facilitating fast, fact-based decisions and collaboration. Likewise, managers can view business insights from any angle.

 So, how does it all work in practice?

 Let's use sales orders as an example. When they can be automatically fed to the finance and order management departments, both units can get their work done - closing books and processing orders - faster and with fewer errors. Therefore, an ERP system reduces manual data entry and improves the flow of information throughout the organization.

 Why use an ERP system?

 Most growing companies start by using a variety of simple, stand-alone tools to manage different processes, such as QuickBooks, Excel spreadsheets and more. But as businesses grow, managing disparate applications can become confusing and time-consuming.

 Thus, most large companies have robust ERP systems. But how and when should small and medium-sized enterprises (SMBs) implement Customized ERP Software's in Dubai?

 More flexibility

 Many companies turn to ERP software because they are frustrated by the rigidity of their current models. Without easy access to accurate information, a number of essential questions may remain a mystery: is your company making money? Which of your customers are most profitable? What impact do market price fluctuations have on product costs? An ERP system makes it very easy to answer these types of questions.

 Better data management

 If your company is drowning in spreadsheets, relying on paper-based processes or acting on bad information from fragmented solutions, it's probably time to consider enterprise resource planning software.

 With a better flow of information, your business teams can do their job more efficiently. They can streamline accounting, asset management, purchasing, manufacturing, inventory, customer service, hiring, payroll and more.

 The good news for SMBs is that the cloud makes ERP systems much more accessible - especially when provided as software and platform services . Cloud-based enterprise resource planning software is readily available and requires a low initial investment.

 Small and medium-sized businesses in favor of a local approach are also much better off than they were years ago. The investment required to run your ERP system on your own premises has been significantly reduced.

 How are ERP systems changing?

 To keep up with digitalization, ERP systems also had to evolve. Business activities in a dynamic digital economy are constantly changing. Thus, they need to be carried out in various channels and points of contact.

 Customization

 Although previous ERP systems stood out in the integration, adding new features could be time consuming or even require a complete overhaul. Today's ERP systems are made up of loosely coupled components that can be easily added or removed according to growing business needs - giving organizations the flexibility they need to thrive in the digital economy. In addition, cloud solutions can fill any functional gaps and expand business resources.

 Technology

 In-memory, mobile, social computing and the Internet of Things have also had a dramatic effect on today's ERP software environment. Enterprise resource planning systems are beginning to incorporate all of these technologies to transmit information in real time between departments. They include analytical technologies that help companies make decisions based on data and manage performance from moment to moment.

 In the same way - and in many cases thanks to these latest technologies - the limits of the industry have become blurred. Companies that focused on classic manufacturing a few years ago are now using mobile technology to provide their customers with after-sales services and have found a completely new revenue stream. Others who used to sell through a distribution network may now be using the web and social media to find an additional sales channel. These changes need to be reflected in a company's ERP system. That's why the next generation ERP systems offer much more agility than the previous generation.

 Decision-making

 ERP provides a digital business core - a kind of nerve center - that consolidates internal and external elements in a single structure. In this way, it connects processes, provides information and live insights and integrates the company with the world in general. With a solid digital foundation, you can add specific lines of business solutions - such as finance, HR, sourcing and purchasing, R&D, asset management and more - as needed. As the functionality of ERP systems changes, so does the definition of the term. But one thing is for sure: enterprise resource planning software is good for business. It positions your company to make faster decisions, embrace new opportunities and drive profitable growth. Ready to make the change?

 

Read also: What are the types of auditing?

 

How to choose your accounting software?

 

It is difficult to make the right choice when you are mindful of other things. But, while it may take some effort at first, the benefits of reduced workload will be felt in the long run.

 Businesses are born from an idea and a passion and that's what should keep you going. Getting the right accounting software isn't just about the numbers. This can help you support your mission and goals. The right software will support your business as it grows and prepare you for whatever the future holds.

 Before purchasing a product, ask the software vendor the following questions:

 1. Will the accounting software change with my business?

 Everyone wants their business to grow. In doing so, and as a manager, you will need to hone and develop your knowledge, and learn more about business management. However, good accounting software will grow with you, with additional software packages from the same software vendor sometimes coming into play as your business develops new requirements, such as processing payroll or payments.

 2. How easy is it to share key data with business stakeholders?

 In a modern, forward-thinking business, financial data is shared with those who need it, and instantly. In particular, a sales team can have access to a dashboard giving an overview of the company's finances which allows it to progress. This type of culture fosters success and growth, and at the heart of this culture is the right accounting software.

 The ability to create custom dashboards or reports is a necessity, as is the ability to easily share them with key stakeholders.

 3. Will my software be up to the technology of tomorrow?

 Along with the use of artificial intelligence, the other incredibly promising technology for the future is block chain. It is still too early for accounting software to process crypto currency (most software only focuses on legal prices), but it is not incongruous to ask whether the accounting software vendor is monitoring or not the same technological horizon as you, or even, what is its position on future technologies like block chain.

 Ask the vendor if they have a phased approach to existing technologies, such as mobile technologies and the cloud.

  4. Does the software help me stay in compliance?

 The business world is difficult, especially if you are just starting out as a business manager, as legal requirements seem to come from all directions. Above all, it is about being able to manage taxes, because a company that cannot pay its taxes is almost bankrupt. Another common area of ​​compliance is payroll and pensions, where the rules can be complex, but software can quickly simplify the workload. There is also the need to keep your data safe so as not to violate data protection laws.

 Good Customized ERP Software's in Dubai will help you comply with the laws by providing you with features that will help you stay in compliance.

 5. Which reports and dashboards stand out?

 Just like in your car, the accounting software dashboard aims to give you the key information you need at a glance. The best accounting software includes at least one dashboard and it can revolutionize the life of the business.

 Rather than having to run a report every time you want to see the data in context, you can just glance at a dashboard and see real-time, up-to-date information. Viewing data this way allows you to become responsive and keep up with trends and developments, or just put an end to potential issues before they even emerge. However, essential accounting information is not the only one that appears on a dashboard.

Read also: 5 keys to correctly choosing an ERP software

 The ability to set up custom dashboards (or bespoke reports) can provide new insights and reveal relationships between data that were previously impossible to see.

Advantages and disadvantages of having an accounting software

 In this new digital age, companies have been forced to drastically change their resource management and coordination processes, to the point that today most of their documents are produced electronically.

 One of the departments that has changed the most in this process is finance, due to the centralization of all its tasks through accounting systems, which is why today we have decided to show you the advantages and disadvantages of these programs in the administration of SMEs.

 Advantages of using an accounting system

 The main objective of accounting systems or software is to automate and simplify administrative tasks within an organization, since they allow unifying accounting and commercial operations, thus allowing companies to manage their resources more efficiently. Below we will mention some of its benefits:

 They save time and money

 One of the most important benefits of implementing an accounting system is that it allows companies to save time and money in the preparation of their accounting records, since they need a much smaller amount of resources to function and drastically reduce the amount of errors.

 Improve business management

 By using Customized accounting software, companies not only have all their data unified and stored in one place, but it also facilitates decision-making and allows them to better manage the company's resources.

 They simplify administrative processes

 One of the challenges that companies currently face is how difficult it is for them to keep all their accounting processes up to date, however, with the use of these programs it is much easier to automate work and streamline day-to-day tasks.

 Improve the availability of your vouchers

 By having all the receipts organized and unified in the same system, companies can have their information available at all times and search times are reduced. Another advantage offered by these programs is that many are stored in the cloud, which allows you to manage accounting information at any time and from anywhere.

 Reduce the amount of paper

 Thanks to the fact that these systems issue receipts electronically, by implementing them companies can drastically reduce their paper consumption, printing costs and the impact their activities have on the environment.

 Disadvantages of implementing an accounting system

 Now that we know the advantages of using these programs, it is important that we also bear in mind some problems that the use of these systems can cause in business administration.

 Require prior knowledge to use

Most of the administrative software are designed and thought for people with a high accounting knowledge, so we recommend choosing programs with a friendly interface and that offer a good support service so that you can get the most out of all its functions.

 They need constant maintenance

 Another drawback of these systems is that some require constant maintenance and updating. In these cases, it is best to select an application that updates automatically to avoid installing additional packages.

 They cause extra expenses

 Although most of these systems offer reasonable rates, many of them require the installation of additional RAM or modern processors for their use, which is why we recommend using accounting applications in the cloud that do not require local facilities to function.

 Now that you know all the advantages and disadvantages of accounting systems, you no longer have an excuse to automate the administrative tasks of your business, so we recommend studying the different options that exist in the market and selecting the program that best suits your needs.

 If you liked this information, we recommend that you also read our article on Tips for keeping accounting for SMEs, where we explain the latest accounting news and give you tips to improve the management of your business.

Read also: Accounting advice and its benefits