Statutory Audit is a kind of compulsory auditing required by law, for example, the auditing conducted by the Chinese Certified Public Accountants for the foreign investment enterprises or listed companies every year. Also, in accordance with Hong Kong “Companies Ordinance”, the limited company registered in Hong Kong shall appoint Certified Public Accountants to conduct auditing every year. The auditor shall conduct auditing on the profit and loss statement, balance sheet, and relevant receipts according to the auditing standards. They shall also comment on whether the accounting system formulated by the enterprise complies with the GAAP and its effectiveness in the actual application process.

Guided by the principle of independence, the audit team of PFR provides annual auditor’s reports that meet the auditing standards for the enterprise, and provides audit opinions on the authenticity and equity of financial statements and accounting records, as well as the consistency of accounting process. We can provide management proposal in which to list out the existing critical problems, with improvement plan, references and suggestions, if required.

Information Needed for Auditing

• Audit the annual financial statements (including the income statement, balance sheet and cash flow statement)
• The accounting record in the fiscal year (including bank statements, contracts, expense invoices and receipts, etc.)
• The list of affiliated company and affiliated persons
• Other relevant information

Process of Auditing

• Draft the auditing plans to ensure the auditing targets
• Understand and comment on the internal controlling system of enterprise
• Gather and record or copy relevant information
• Compliance testing and comment on the result
• Substantive control and comment on the result
• Draft auditing report and forward to the company being audited

Internal Audit is a supervision action for internal economy of an enterprise. Internal Audit focuses on enterprises financial data and affects different elements of enterprise operation, such as internal management, sales planning, operational risk, product quality and operational environment, etc. The internal audit team of PFR has years of practical experience in serving different industries, helping corporate clients to solve various problems which affect their operation through internal audit.

The Scopes of Internal Audit:

• Financial Audit
• Operational Audit
• Management Audit
• Risk Management

The Internal Audit Targets:

• Commodity: Conduct audit on the inventory and fixed asset, etc.
• Finance: Conduct audit on the debentures and liabilities caused by providing and selling products or labour affairs.
• Rules: Conduct audit on the implementation process and results of the system, standard and workflow, etc.
• The Economic Responsibility Audit:
  Conduct audit on the economic responsibility performance of the enterprise manager during the term of office and the status at the end of term.

Nowadays, the business environment is getting increasingly complicated, enterprises may need to conduct special purpose audit due to different operational reasons in order to satisfy different management goals and needs. PFR is experienced in auditing of different purposes for various industries. We can provide reliable evidences for the investors by the auditing and professional advice provided by the auditors.

Special purpose audit is conducted based on the following financial messages and generates the auditor’s reports:

• Formulate the financial statement in accordance with the special basis (e.g. tax basis, cash basis system, the report requirements of regulators)
• One or more components of financial statements
• Compliance with the contract
• Brief financial statements