The role of an external auditor is crucial in achieving the objective of corporate governance. The external auditors are responsible for auditing the company's financial statement and providing reasonable assurance that they are presented fairly in conformity with the required standards.
The study conclude that the role of audit or that can enhance corporate governance were evaluating risks, evaluating controls and operations, advising managers, assessing compliance with policies and procedures, verifying the existence of assets and providing opinion on financial statements.
The Role Of Auditors In Corporate Governance
- Represent Shareholder’s Interests One of the most important functions of an auditor is to represent the interests of shareholders. ...
The auditor does not have direct corporate governance responsibility but rather
provides a check on the information aspects of the governance system. Where does the auditor fit in? Corporate governance involves decision making, accountability, and monitoring. Decisions require relevant and reliable information.
Role of an External Auditor in Corporate Governance
- Represent Interest of Shareholders One role of auditors in corporate governance is protecting the interests of shareholders. ...
Auditors help in promoting corporate governance by conducting a period risk assessment. External auditors reassess the security measures that a company has in place against corruption or corporate fraud.
The fact that the auditors examine all the financial statements and eliminate any manipulation in the accounts gives them a major role in corporate governance. The effectiveness of any corporate governance is always dependant on the professionalism and the quality of the information provided by an auditor.