An audit which conducted in between the two annual audits with a view to find out interim profits to enable the company to declare an interim dividend is known as Interim Audit. It is a kind of audit which is conducted between the two periodical or balance sheet audits.
Objectives Of Interim Audit
1. To know profit or loss of interim period.
2. To distribute interim dividend.
3. To get loan on the basis of interim account.
4. To get information about the financial position of interim period.
INTERIM AUDIT is an audit conducted during the fiscal year usually as a means of minimizing the work and time involved in concluding the audit after the fiscal year. A corporation might have an interim audit covering the first nine months of the fiscal year so that at the end of the fiscal year most of the auditing will focus on the last three months of the fiscal year thus allowing for a comprehensive audit and early completion of the audit reports. An interim audit does not usually yield any formal reports from the external auditors.
An interim audit is type of auditing strategy that is normally utilized at some point during the current fiscal year. This type of audit makes it possible to complete at least some of the tasks that are involved with the preparation of a final audit once the fiscal year has closed. The benefit of this approach is that it is possible to provide shareholders and other interested parties with final audit data sooner than if the final audit was commenced after the fiscal year was completed.
Like any type of auditing task, an interim audit will involve close examination of financial records. Interim auditing standards are the same as those used to conduct any type of accounting or inventory check, and must comply with all policies and procedures that are part of the final audit process. This is necessary since the data collected and analyzed during the interim auditing has a direct effect on the outcome of that...