VIEWpoint Issue 2 | 2018
Tax Cuts and Jobs Act – Highlights of What is Ahead for You...
VIEWpoint Issue 3 | 2017
Overview of the Business Valuation Process
Three Questions You May Have After You File Your Return
How Long Should You Keep Your Tax Returns on File?
Having a good working relationship with your auditor is always important. However, keeping a proper balance between how the auditor, as an “independent third party,” develops a good working relationship with great client service while maintaining independence is critical.
Audits are important for a variety of reasons. Perhaps your company is relying on the audit to satisfy lending requirements or Securities and Exchange Commission (SEC) regulations. No matter what the incentive, the fundamental purpose of an external audit is to add credibility, by an independent third party, to management’s assertion that your financial statements fairly represent the organization’s financial position and activities as of or for a period of time. Without remaining independent and uninfluenced by internal parties involved, your auditor can’t meet this objective.
There are many regulating bodies within the United States and abroad that require different requirements for auditor independence. However, they all have similar overarching principles guiding the degree of separation between you and your auditor. Doeren Mayhew’s CPAs and advisors share four questions you can ask yourself to determine if your interaction with your auditor might violate independence guidelines:
Affirmative answers may indicate possible independence issues. Avoiding any circumstances that may cause a reasonable and uninformed third party to conclude your auditors’ integrity, objectivity or professional skepticism has been compromised is necessary.
Independence rules can be complex, and some more restrictive than others depending on the authoritative regulatory bodies issuing them. However, independence rules are designed to ensure the integrity and credibility of your auditors’ opinion on your financial statements. Proactive, open communication with your auditor well before your audit begins will help resolve any independence questions and provide the best of both worlds – a high quality independent audit with great client service.
Expect Doeren Mayhew’s auditors to remain committed to their independence in order to provide services and opinions on your financial statements that stakeholders can count on. Reach out to them today to put your next audit in motion.
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