Advantages of Auditing

1. Help to detect and prevent fraud and error:
Audit has to detect and prevent frauds and errors. Frauds and errors can be located and rectified with the help of audit.

2. Help to obtain loan:
Audited statement help them to obtain loan from financial institution. An organization should make audit compulsory to obtain loan.

3. Acceptability by the authority:
Audited accounts are readily acceptable by the income tax, sales tax and other authorities.

4. Helps on professional advice:
Independent auditor also provide services other than auditing. They provide tax worth.

5. Settlement of disputes:
Incase of partnership firm disputes among the partners about the overprofit sharing is settled when accounts are duly audited.

6. Helps to sale the business:
The audited financial statement of business gives more reliable financial position. Evaluation of assets is more reliable. Hence it helps to sale the business.

7. Helps to present as proof:
The auditor can present audited report as a proof to settle case file against the auditor regarding negligence.

8. Helps to compare financial performance:
Audited financial statement are considered more reliable to compare the financial performance of a business.