Most business owners are scared of the word “audit”, it has been made to look like a bad word because once it is mentioned, and the business owner starts thinking about the Inland Revenue Board (IRB). However, they fail to understand that the IRB tax audit is not the only type of audit on the planet, there are others which a beneficial for your business.
Many businesses, mostly multinationals do internal self-audits per annum to make sure that their books are accurate. External audits may be necessary if your business is applying for certifications or any other programs. And if your tax return is not accurate then the IRB can audit you.
But the question is, what is an audit?
For a small business, an audit is an examination of the accounting books and tax returns of the business to ensure that that are correct and are compliant to the relevant laws.