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An engagement usually has four phases: planning (understanding the company and the risks), interim audit (during the year, reviewing the processes), year-end audit (detailed testing of the financial statements) and

The management letter is a written summary issued at the end of the audit, on request, in which the auditor sets out the findings and the recommendations on internal controls.

An audit is an independent, expert examination of the financial statements: an assessment of whether they present the company’s assets, financial position and results in line with the accounting rules,

As a general rule, an audit is mandatory if the company exceeds both thresholds in two consecutive financial years: the annual net revenue threshold and the average headcount threshold. (It

A statutory audit is required by law. A voluntary audit is carried out at the request of an owner, a bank or an investor, for example for a loan application,

Only an auditor or audit firm registered with the Hungarian Chamber of Auditors. The appointed auditor is always a named chamber member, who is also personally responsible for the work.

The auditor’s report is the outcome of the audit: the auditor’s written, independent opinion on whether the financial statements give a true and fair view. This is the document that

There are four basic types: an unqualified (clean) opinion, where the financial statements are reliable; a qualified opinion, where there is a specific, identifiable misstatement or limitation; an adverse opinion,

The management representation letter is management’s written confirmation to the auditor that it has provided all material information and that responsibility for the financial statements lies with management. It forms

External confirmation is a procedure in which the auditor asks an independent third party directly for written confirmation of a balance. Typical cases are the confirmation of customer and supplier