Audit of the system in the function of increasing financial stability based on decision-making in companies whose founders are local government units

Abstract

Financial management should base its decision-making on realistic financial statements, and for the preparation of realistic financial statements it is necessary to establish a system in which the audit of the entire business system of the company will be implemented. The audit of the system is based on: realistic planning, taking each business segment as part of the whole business, starting point in a constructive approach to the audit, regular reporting to top management, implementation of actions based on the auditor's report. In this paper, the authors paid special attention to the analysis of the revision of the system of functioning of the enterprise as a whole. In addition, the authors point out the importance of all phases of company audit. The application of system revision is possible in a large number of heterogeneous companies in transition countries such as the Republic of Serbia. The aim of this paper is to show the advantages of the real application of system audit in the practical functioning of the company, especially with companies whose founders are local self-government units.

Keywords

• system audit
• audit phases
• financial stability