THE 9 MOST IMPORTANT STATUTORY AUDITOR FUNCTIONS - CULTURE VOCABULARY - 2025

The most important functions of the statutory auditor are to supervise the proper performance of the commercial and financial operations of the organization to which it provides its services, and to report errors or irregularities in the activities.

In many countries, the statutory auditor is an external auditor of a commercial company who is responsible for certifying the financial statements and economic activities of the same, in accordance with current auditing standards and state tax laws.

The International Standard on Auditing (ISA for its acronym in English) is the most widely used model worldwide for statutory auditing, which is developed in international institutes and federations of public accountants.

In the business world, it is recommended that these functions be carried out by a person completely independent of the organization and its payroll, so that their opinions are as objective as possible, without any conflict of interest or dependence on the organization.

However, it is not unusual to find tax auditors who are part of the internal structure and payroll of employees of the company.

Essential functions that a tax auditor must fulfill

1.- About the organization's operations

The tax auditor is in charge of verifying that the commercial and financial transactions carried out by an entity are adjusted within the legal regulatory framework and the statutes of the organization.

In the same way, the tax auditor ensures that all activity or exercise of the company to which it provides its services, has been duly decided by the general assembly of partners and the board of directors.

2.- About irregularities

Any irregularity in the processes of development and operation of the normal exercise of the organization must be timely notified to the relevant body or department, depending on the case.

These are the general assembly, board of directors or partners, president, manager, administrator, accountant, etc. This account proceeds in writing and is recorded in the minute book.

With this function, the tax auditor is always vigilant of any abnormality in the business of the company and the activities of that company.

A timely notice guarantees the taking of corrective measures and / or procedural adjustments by the organization, and thus not incur in a crime, infraction or tax fraud.

The reputation of the company and that of the tax auditor itself are at stake in these legal contexts.

3.- On the relationship with government control agencies

It is the duty of the fiscal auditor to collaborate with the state fiscal control and regulation entities at the time of an inspection, audit, examination or routine request, and present detailed information if any is requested.

For this reason, it is very important that the tax auditor keep all the records of the company's business activities and operations up to date, correctly noted and supported.

All this in order to give evidence of completely legal fiscal and commercial activity to the government.

4.- On the records of activities and operations

To ensure that every critical area of ​​a company is functioning in order (in tax matters), there is no organizational activity in which the reviewer should not monitor and give his professional opinion on the matter.

The limitations are established within the definition of the functions at the time of the contract with the company, but it is part of the professional ethics of the tax auditor to communicate any irregularity seen within their reach.

For this reason, the reviewer periodically supervises the tasks of accounting and the correct recording of his business operations in the books.

Also, you must ensure that the minutes of meetings of the assemblies, board of partners, board of directors, etc. are kept correctly.

Especially, all types of accounts, records, vouchers, reports and supports that are part of the fiscal responsibilities of the company or have repercussions on them, it is necessary that the reviewer is aware of and keeps giving instructions in this regard.

5.- On the goods and properties

The tax auditor must know the status of the organization's movable and immovable assets and inspect them regularly.

This in order to keep documents and legal responsibilities such as invoices, titles, concessions, contracts, among others in order.

A regular control will allow to take timely maintenance, conservation, custody, security and renewal measures of the goods, properties and values, as well as of their documents and records.

6.- On issuance of documents with your name

A tax auditor duly registered under the legal, institutional and union bodies of his professional practice, is authorized to sign all kinds of documents related to the treasury and the company he provides services to.

Among them are the balance sheets and references. Any document with your signature must have been duly requested and have its corresponding report.

7.- About its scope

Every fiscal auditor of a company must have access at all times to the fiscal books of the company, as well as all invoices, receipts, payment orders, account statements, records and other legal documents.

This can work directly in the relevant offices of the organization or by requesting them from the responsible officials of each area.

8.- About their qualifications

The reputation of the statutory auditor will depend on the efficiency and objectivity of the exercise of their functions.

For this, it is important that you are duly affiliated and up-to-date with the legal, institutional and union organizations in your area.

Likewise, be constantly updated in relation to the laws, regulations and procedures in force in your work area.

9.- Some of its limitations

- The statutory auditor is fully responsible for giving his opinion, giving instructions and giving recommendations on the management and administration of the company. However, it does not have the power to impose any decision on those responsible for the organization.

- The fiscal auditor does not fulfill the functions of administrator or accountant of the organization. Its functions do not have scope on the management or manipulation of the resources of the society.

- The fiscal auditor can (and in some cases must) participate in the meetings of partners, assemblies, councils and boards of directors. It is even within his functions to intervene when he deems it convenient, but he does not have the right to vote.

References

1. Ashok B Nawal (2016). Roles & Responsibilities of the Auditor under Companies Act 2013. Bizsol. Recovered from bizsolindia.com
2. Vinod Kumar (2016). Statutory Duties of an Auditor. Accounting Education. Recovered from svtuition.org
3. Green papers. The Role, the Position and the Liability of the Statutory Auditor within the European Union (online document). European Union website. Recovered from europa.eu
4. Statutory Audit. Recovered from investopedia.com
5. PCAOB (2016). AU Section 110 - Responsibilities and Functions of the Independent Auditor. Public Company Accounting Oversight Board. Recovered from pcaobus.org
6. Jairo Prada Hernández (2015). Functions of the Statutory Auditor. Newsletters and Updates. CR Consultores - Colombia. Recovered from crconsultorescolombia.com
7. Carlos Sastoque M. (2014) What are the functions of the Statutory Auditor? Get updated. Recovered from actualicese.com