What Is an Audit?

An audit is a formal examination of a company’s financial records to confirm that they are accurate, complete, and prepared in accordance with applicable accounting standards and legal requirements. Audits play a critical role in ensuring transparency, regulatory compliance, and trust.

In Thailand, the audit process requires two separate professionals. Financial statements must be prepared by a qualified accountant and then independently reviewed and signed off by a licensed auditor. Both are required for the audit to be valid.

What Is an Audit and Why Is It Required?

What is an audit required for? Authorities and regulators rely on audits to ensure that companies are reporting their financial position and tax obligations correctly.

An audit helps to:

• Verify the accuracy of financial statements

• Ensure compliance with accounting and legal standards

• Identify errors or inconsistencies

• Provide confidence to regulators, banks, and business partners

Submitting audited financial statements is a legal requirement, not an option.

What Is an Audit Process in Practice?

An audit is carried out by an independent, licensed auditor who reviews financial records prepared by the company’s accountant.

In Thailand, the process typically involves:

• A qualified accountant preparing the financial statements

• A licensed auditor reviewing, testing, and verifying those records

• Both the accountant and auditor signing off on the final accounts

This separation ensures independence and accountability while protecting the integrity of the audit. An auditor may refuse to sign off on accounts if they do not meet sufficient regulatory standards.

How is an Audit Different From Accounting?

Accounting is the ongoing process of recording a company’s financial transactions, while an audit is an independent review of those records.

The key differences include:

• Accounting is continuous; an audit is periodic

• Accountants prepare financial statements; auditors verify them

• Audits provide independent assurance rather than operational control

Accurate bookkeeping and accounting throughout the year make the audit process significantly smoother and more efficient.

What Happens If a Company Is Not Audit-Ready?

What is an audit risk for businesses with poor records? Companies that are unprepared may face:

• Delays in filing financial statements

• Higher audit costs

• Regulatory penalties or fines

• Increased scrutiny from authorities

• Delays or missed visa dates
• Company closure

Maintaining accurate records throughout the year is the most effective way to reduce audit-related risk and costs.
At Attori Law we provide both bookkeeping and accounting services as well as full audits for small to large companies.

Audit FAQs for Business Owners