Controlling mainly deals with the investigation of all the
activities performed by a firm and ensuring whether these activities are
performed as per the plan, and if any deviations are detected then taking
required measures to eliminate those deviations. Financial control involves all
those activities and efforts made by the firm to track the source, inflow,
outflow and usage of financial resources. Financial control includes all those
strategies which are taken to confirm that the financial resources are utilized
in the proper manner.
Financial control audit is concerned with and revolves
around the financial transactions and financial position of the company. It
takes into account all the transactions made by the firm and the records and
statements maintained in respect of those transactions. The main objective of
conducting such an audit is to analyse the financial feasibility of a firm.
Through which the firm can find out the loop holes in its strategies and plans
as well as the utilization of finance and they can take the corrective measure
to eliminate those loopholes. It also includes supervision of activities of
firms and whether they adhere with the financial control procedures or not. Auditing firms in Dubai can help you in
conducting the financial control audit process for your company.
Financial control audit can be considered as a post mortem
of all the financial activities, through evaluation of cash flow statements,
payroll statements, cost analysis etc. By conducting a thorough research the
auditor tries to find out the area where the firm can reduce the financial
resources’ wastage, and then he may suggest the required steps that are to be
taken to have a control over the flow of finance i.e. diverting the finance to
required areas and stoppage or reduction of flow of finance in unproductive
The financial control audit may benefit the business in the
1. Identifying abnormalities: It enables the firm to identify the abnormalities in financial statements, budget, cost, balance sheets etc. by conducting the audit, the firm can verify whether the statements are accurate and compare it with the facts and reports available.
2. Helpful in budget making: Audit reports can be used to draft the budget for future years. By assessing the financial statements the firm can study the drawbacks and the opportunities available, and this study can be used to draw new strategies and draft the budget of the firm.
3. Evaluation of all operational activities, and the areas where the financial resources are required. Through the audit, the firm can analyse the areas within the firm where financial resources are required and it can get a clear picture regarding the volume of resources required in future and can design the plan in order to meet those requirements.
4. It may help to maintain a smooth cash flow: Conducting an audit will help the firm to cut off unnecessary expenditures and reduce the excessive cash flow; hence the firm can maintain a controlled cash flow.
5. Detection of fraud and malpractices: Various frauds and malpractices can be detected as well as avoided, by conducting a financial control audit. Through this process the firm can track all the sources of financial resources and the activities for which these are used.
6. Prevention of financial instability: The firm can be saved from financial shocks as the auditor may provide early warning signals regarding the financial threats to the firm and the firm can get ready in advance to face such challenges.
7. Ensuring whether the control procedures adopted are followed by the firm or not.
Suppose a food processing company decided to diversify its
activities and planned to establish its business overseas, so the company
undertook a financial control audit to analyse the amount of additional
financial resources required by it. When the audit report came, the company
found that the actual amount of expenses was more than the anticipated one and
the company was facing financial scarcity. When the reasons for such challenges
were evaluated, it was found that there was an increase in overhead costs, as
well as there was a large amount of payments overdue from the customers. After detecting the loop holes the company
decided to monitor the overhead costs and reduce it, and it also took measures
to receive the payments from the customers.
In the above situation we can see how a financial control audit helped a firm to dig up the required resources for achieving the desired goals. Financial control audit by verifying each and every financial statement, reconciliation, managing overall financial activities, studying each and every transaction and the reports tries to closely watch every minute changes in the financial resources. The irregularities faced by a firm concerning financial resources, i.e. inadequacy of finance, or sometimes a company may receive funds more than expected, but with the help of proper financial control audit we can track down the reasons for such changes and imbalance in financial position of a firm or company.
An out-and-out Audit of a firm will help to identify
different factors important for the growth and expansion of the company. If you
are looking for auditing and bookkeeping
services in Dubai, then you should approach the best auditing firm in
Dubai, Because they provide a wide variety of services to its clientele with
regard to accounting and other related tasks. The most experienced and leading
audit firms in Dubai always try to provide personalized and professionalized
services with a hardworking and dedicated team who have the best experiences in
solving all the kinds of hindrance faced by their clients.