What are the key conditions or circumstances that must be present for a company to be "auditable"? What uncommon challenges to "

Question

boyakko [2]

3 years ago

5

What are the key conditions or circumstances that must be present for a company to be "auditable"? What uncommon challenges to "

auditability" are posed by Chinese companies?

Business

1 answer:

Rasek [7] · Answer 1 · 2022-07-06T14:08:14+03:00

Answer:1.

1. Key conditions for the company to be "auditable" :

- Transparency in the company's financial statements

Meaning the company should let the auditors acess the full financial information taht written by the company, without any information to hide.

- The company's control environment

This mean that the company should be able to inform the set of procedures that it implemented for the operation

- Management is aware of possible risks and are following steps to minimize the risks ethically

This means that the management shouldn't overblown their expense to increase their deductible or overblown their asset value to obtain investors.

- Good communication between the auditors and the management

2. What uncommon challenges to "auditability" are posed by Chinese companies?

Unlike united states government, the Chinese government tend to have a really strong influence within the private sector. It has a significant amount of ownership toward chinese largest corpration.

This make it really hard for auditors because those companies often required by the government not to spill crucial information of the company. That information might compromise the Chinese government.