Audit is an additional check of the financial statements and principles of accounting. Usually, an audit involves the review of the company’s annual financial report – the audit review helps identify potential errors and inconsistencies in the financial documentation, and provides an objective assessment of the company’s financial condition.
Audits are conducted by independent expert auditors who evaluate the accuracy of financial information and its compliance with established standards. It is important to note that audits not only identify problems but also help find solutions, thereby improving the company’s financial management.
Why is an audit review necessary?
The purpose of an audit review is to ensure the accuracy and transparency of the company’s economic condition and financial indicators, including the data provided to the Commercial Register and the Tax and Customs Board.
Audit review is conducted by a specialized audit firm or an independent certified auditor. The audit involves reviewing all financial, accounting, and other relevant documentation, as well as studying the company’s business processes. Based on the results of the audit review, a corresponding report on the company’s financial condition and economic indicators is prepared.
When is an audit mandatory?
In Estonia, the requirement for an audit depends on the size and type of the company. The law sets criteria that determine the necessity of a mandatory audit for certain enterprises. At the same time, companies have the right to initiate an audit at their discretion, considering internal needs or requests from stakeholders.
According to the law, annual financial statement audits must be conducted by enterprises that:
a) Meet at least two of the following criteria:
- Sales revenue or income exceeds 4 million euros
- Balance sheet total exceeds 2 million euros
- Number of employees exceeds 50
b) Meet at least one of the following criteria:
- Sales revenue or income exceeds 12 million euros
- Balance sheet total exceeds 6 million euros
- Number of employees exceeds 180
It is important to note that even if your company does not meet the criteria for a mandatory audit, a voluntary audit review can be beneficial for enhancing the transparency and reliability of financial statements. This is especially relevant for companies planning to attract investments or expand their business. At Eesti Firma, we are ready to help you determine the need for an audit and choose the optimal solution for your business.
Organization and support of audit reviews
Consultants at Eesti Firma have experience in organizing and supporting audit reviews and inspections for enterprises from various sectors of the economy. We collaborate with leading audit firms in Estonia, ensuring high quality and efficiency of the reviews.
Our specialists will conduct an initial consultation, provide a preliminary assessment of the financial situation and the accuracy of accounting in your company, suggest necessary corrections and adjustments to financial reporting principles if needed, organize the audit review, and support you throughout the entire process.
We strive to make the audit not just a formal procedure, but a tool for the development and strengthening of your company.
