Statutory audit of companies

In our years of experience we have developed our own methodology for company audits based on international audit standards. This has allowed us to perform audits efficiently without excessive requirements on our clients in terms of preparation of audit documents. At the same time, our methodology helps us identify serious accounting errors and problems.

Who needs statutory audits?

Section 20 of the Accounting Act defined, what types of companies and organisations must perform statutory audits. These legal entities are required to develop and present due or extraordinary final accounts and have them audited by professional auditors.

Companies and organisations may also choose to perform voluntary statutory audits. This may be due to their owners’ wish to ensure the correctness of bookkeeping for their own purposes. In some cases, statutory audits are requested by creditors, mostly banks and other financial institutions

How does it work?

Statutory audits are performed in several stages, specifically the initial, main and final stages. The final stage is where the auditor reviews the final accounts and develops the final auditor report with auditor’s statement.

Initial audit stage

At this stage, the overall audit plan is approved including specifications of the areas that are to be studied by our auditors. At the same time, we talk to the client and together we define the schedule of all necessary activities and a detailed timetable.

Main audit stage

At this stage, the audit team focuses on the review of the client’s internal audit system and its efficiency. Our evaluation is based on scrutiny of a selected data sample from the most areas of accounting books including observation of the company’s internal rules and regulations.
At the same time, the auditor performs an adequate inspection of the stocktaking process based on the organisation’s internal asset and liability stocktaking rules. At this point, the auditor evaluates important factors that might have had an influence on the company’s results in the past period. The auditor also looks into the client’s final accounts strategy. This stage is where we develop interim reports notifying the client of any discrepancies or problems that need to be corrected.

Final audit stage

The objective of the final audit stage is to review the final accounts and develop the audit report. Before this is done, however, the auditor checks the main ledger balance as of the final accounts day and the continuity of related reports.
We always make sure that accounting books show a true and accurate picture of the organisation’s assets, liabilities, net assets and financial results. At the same time, we make sure that books are kept in accordance with legal regulations applicable to final accounts presentation. The final audit stage also includes verification that the data stated in the annual report and the relations report correspond to the data stated in the audited final accounts.
Our efforts culminate in the final audit report zprávou auditora the auditor’s statement. The client (accounting unit) receives an auditor letter – a private document stating the conclusions for each audited area and suggested measures to correct potential shortcomings.

Statutory audit – legal regulations and standards

Our auditors perform statutory audits of final accounts developed in accordance with the following legal regulations and standards:

• Legal regulations of the Czech Republic addressing accounting and bookkeeping issues valid and applicable as of the date of the final accounts, specifically Act no. 563/1991 Coll., on accounting, Decree no. 500/2002 Coll. And the Czech Accounting Standards.
• International Accounting Standards.
• Consolidated final accounts.

The actual statutory audit is performed in accordance with Act no. 93/2009 Coll., on auditors, as amended, and International Audit Standards.

For more information on statutory audits of companies, please, contact us using this form.