Alpha Capitalis
Audit
Audit
Audit
Audit is a systematic and independent examination of financial statements and other business documentation of companies. The purpose of the audit is to ensure the reliability of the financial statements, that they are maintained according to the law requirements, and that they represent true and fair view of the company.
Who are the beneficiaries of the audit?
- Owners / Shareholders
- Investors
- Credit institutions
- Related companies
- Business partners
Our audit services:
- Audit of annual financial statements
- Audit Insights into the Financial Statements of Nonprofits
- Audit of projects funded by EU funds and the Croatian Science Foundation
- Audit of Mergers and Acquisitions
- Audit of formation
- Audit of share capital changes
- Stock valuation audit
Revision of the financial statements
The audit of the financial statements is the procedure for verifying and assessing the financial statements and consolidated financial statements of the taxpayer, as well as the data and methods used in the preparation of the financial statements.
Includes auditing of the following financial statements:
- balance Sheet
- Income Statement
- Cash Flow Statement
- Statement of Changes in Equity
An audit of the financial statements results in the auditor’s opinion as to the accuracy and fair presentation of the financial statements, as well as their compliance with the statutory and financial reporting frameworks required. Every obligator of an audit must designate a statutory audit firm no later than three months before the end of the reporting period to which the audit relates.
Who are the obligators of the financial statements’ audit?
- entities of public interest,
- medium-sized entrepreneurs,
- large entrepreneurs,
- joint stock companies, limited partnerships, limited liability companies that exceed at least two of the following three conditions in the year preceding the audit:
- total assets of HRK 15 million
- total revenue of HRK 30 million
- average number of employees 25,
- entrepreneurs who have applied for listing their securities on the regulated market,
- non-profit organizations that earned more than HRK 10 million in the year preceding the audit.
Audit Insights into the Financial Statements of Nonprofits
An audit of financial statements is a simpler procedure than an audit of financial statements, which examines whether the financial statements have been prepared in all material respects in accordance with the financial reporting framework.
Audit insight is based on analytical procedures and inquiries and not on all the necessary evidence as in the audit process. An audit of the financial statements results in the auditor’s conclusion, which concludes whether the auditor has identified anything that he or she believes the financial statements have not been prepared in all material respects in accordance with the applicable financial reporting framework.
Who are the obligators of the non-profit organizations’ financial statements’ audit?
Obligators of the non-profit organizations’ financial statements’ audit are nonprofit organizations that have generated revenue of $ 3 million, including $ 10 million, in the year preceding the audit insight.
Audit of EU funded projects and the Croatian Science Foundation
An EU project audit serves as a verification that all costs incurred for the project have actually been incurred for the purpose of implementing the project and that they have been foreseen in the project budget. The audit of EU projects also verifies that the expenditure complies with the eligibility criteria for costs with national and European legislation.
EU projects are audited to test, prove and prevent economic and other illegal activities.
Successful implementation of EU project audits requires the pooling of knowledge and skills in accounting, auditing, economics, statistics, informatics, legal regulation and investigative skills
Our EU Project audit services include:
- Audit of EU funded projects
- Consulting on financial management of the project
- Supervision of project documentation
Who are the obligators of EU project audit?
The obligators of EU project audit are all beneficiaries of EU funds, if stipulated in the Call for Proposal or Tender Instructions for bidders.
Revision of Status Changes (Acquisitions, Mergers, and Separations)
In the case of status changes, such as acquisitions, mergers or separations, the obligators of audits are the companies that are the acquirers or the newly established companies in the changes.
Establishment audit
When establishing a company, the auditor is appointed by the court and the audit must be carried out if:
- a member of the management or supervisory board, that is, the executive director or a member of the management board, is also the founder of the company,
- the shares were taken over during the founding on behalf of a member of the Management Board or Supervisory Board, that is, the Executive Director or a member of the Management Board,
- a member of the management board or supervisory board, that is, the executive director or a member of the board of directors, received special privilege at the establishment or received compensation for the establishment,
- the establishment of a company occured by investing or taking over of assets or rights, in which case the evaluation of the value of the assets or rights is used by the finding of an independent permanent court appraiser of the relevant profession.
Revision of increase and decrease of share capital
When increasing the share capital of a company, an audit does not need not be performed if the increase is related to an entry of:
- securities or money market instruments, if their value is determined as a weighted average price traded on the regulated market in the last 3 months before their actual introduction into the company
- other things and rights the value of which is determined by an independent permanent court appraiser according to generally recognized valuation principles, with an appraised valuation study whereby the valuation is not older than 6 months from the date of introduction of the assets and rights in the company.
Stock valuation audit
Valuation audit refers to the audit of the fair value assessment study performed by the assessor. An audit of a valuation involves performing certain procedures in relation to a fair value measurement.
The objective of a valuation audit is to have the Auditor perform certain procedures for which he or she has been engaged in accordance with international valuation / audit standards and to provide a statement of factual findings regarding the procedures performed.
The Independent Certified Auditor’s report on the audit of the valuation shall provide factual findings that the auditor has come to know.
When is it necessary to conduct a stock valuation audit?
The fair value estimate of the target company stock should be audited by an independent certified auditor if the target company stock was traded in less than 1/3 trading days within the period referred to in Art. 16, paragraph 3, or Art. 16 (6) of the Law on Takeover of Joint Stock Companies.
The auditor of the audited study is the natural or legal person who has published the takeover bid or has announced the intention to publish the takeover bid of the target company.
The procedures performed by the auditors as part of the performance of the company audit services are:
- Review of the methodology used by the Assessor
- An overview of the assumptions, inputs and data sources used by the Assessor
- Checks on mathematical accuracy of calculations
When reviewing the methodology used by the Assessor, it should be noted that the methodologies used are generally appropriate and applicable when calculating the valuation. The methodologies can be: comparator companies, comparative transactions, discounted cash flows, stock price analysis of the target company on the regulated market and others.
An overview of the assumptions, inputs and data sources used by the Assessor relates to the relevance and accuracy of the assumptions, inputs and sources used, while the mathematical accuracy of the calculations relates to the accuracy and correctness of numbers, as well as the correctness of formulas in financial models.
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