Who are auditors?
Regardless of what business branch you are in, you must have the support and help of top auditors. And as their role, even today is unknown to many, we spoke with Maja Marić, partner and director of the auditing company FinExpertiza, about auditors’ function and what kind of services experts in this business segment provide.
Can you explain to us what auditors actually do?
It often happens that when asks me what I do for work and when I say “I am an auditor”, everybody goes quiet. People immediately think that I am some kind of inspector, a controller, an interrogator, maybe even a police officer, but definitely an unpopular character who you should run as far away from as possible. Even those who know who auditors are and cooperate with them, do not know their true role and their importance in the business of every company, but see them as a “necessary evil”. But it’s not quite like that.
Auditors are independent experts who boost the credibility of information contained in financial reports with their reports and possess knowledge and skills that can help companies solve crises, and improve their operations, as well as the quality of financial reporting, disclosure and monitoring of accounting standards and regulations.
What do financial reports imply and how often are they read or used in Serbia?
Companies and individuals operate according to rules that are generally not visible to them and known in advance. They are often exposed to risks unknowingly, and therefore have to assess and manage these risks. In the decision-making process, they are guided by past information, which should indicate to them what happened before, that is, what they can possibly expect as a consequence of certain decisions. That’s exactly where financial reports come in, which, among other things, contain that information.
However, this is not the only function of this type of report. Ownership and management have also changed over time, so today, capital owners have the need to exercise control over their assets and investments by monitoring the business results achieved by management. Financial reports prepared by management are part of the process of monitoring and supervising the company’s business results.
Also, financing methods have changed. Banks, individual and institutional investors want to insure their placements, so when assessing investment risk, they ask clients for financial reports.
There are many other cases where financial statements have a decisive impact on business. For instance, before making a decision on establishing cooperation with a supplier or customer, companies look at the financial performance of their potential business partners and then decide on the procurement or delivery of products or services.
Financial reports are important and their users are different, but everyone looks for the same thing in financial reports – timely, reliable, complete and accurate data.
So auditor and financial statements are inextricably linked?
Exactly! I can reiterate the claim I made at the beginning of this interview – an auditor is an independent expert who, with their report on the performed audit of financial statements, boosts the credibility of the information contained in the financial statements. Except in cases when it is a legal obligation, the auditor is usually “summoned” to give an opinion in a crisis. This happens, for example, if there is a problem in the relations between the management and the owner, or if there are financing problems.
What are the other functions and services of an auditor?
An auditor can provide much more than just an audit opinion. They possess knowledge and skills that can help the management improve operations, organization and internal control system in the company. Also, an auditor can have an advisory role when it comes to the quality of financial reporting, disclosure and monitoring of accounting standards and regulations.
In order for the auditor’s know-how and skills to be adequately applied and used, it is necessary to be aware of what the auditor knows and can do, and approach the auditor and the audit in the right way, while, at the same time, recognizing the benefits that these experts provide.
… Regardless of what business branch you are in, it is very important that you have the support and help of top auditors.