Final audit also known as complete audit, periodical audit or balance sheet audit. A final audit one which started at the end of financial year. When financial statements are prepared and carried out until completion. Such kind of audit legally required in certain business organization especially in case of a joint stock company.
Advantages of Final Audit
As the auditor has to check the whole record of that year, he supplied with full facts relating to the accounts and the business.
Continuity of Work
In case of such review, the auditor visits his client’s office only once a year and goes on checking the accounts until the audit work whole of the period completed. So in this way the continuity of work is not likely to be disturbed.
Satisfaction of the Client
In such type of review, the auditor required to examine the record thoroughly. So such audit provides satisfaction not only to the shareholders but also to the owners of small concerns.
Less Chance of Alternations
In such audit, there are less chance of alternations and manipulation of accounting figures after they checked and verified.
Report Regarding the Account
The auditor required to submit the audit report to the shareholders in case of final audit regarding the fairness and correctness of accounts.
Such kind of audit fulfills one of the legal requirements of joint stock Company imposed by companies’ ordinance.
Disadvantages of Final Audit
Some Errors May Remain Undetected
In the audit, practically it not possible for the auditor to check each all entry made in the books of account generally he applies test check. Thus so many errors and mistakes may remain undetected.
Delay in Presentation of Accounts
In case of large business concerns, it takes more time to complete the audit and hence presentation of accounts to the shareholders delayed.
Schedule Cannot be Observed
Generally the auditor has many clients whose financial year’s ends on the same date, so it is not easy for the auditor to finish the work according to the schedule.
Audit Report May be Misleading
Though such type of audit known as complete audit, but this is not correct because each and every transaction cannot be checked by the auditor. So we can say that the auditor report regarding the accounts may be misleading.