Learn with NirmalAryal/Arthabichar Nepal - Guide to Entrepreneurs, Startups, and Business Enthusiast

 An audit is carried out to comply with Income Tax. This is the common understanding we find among the Nepalese business community. It is true but not 100%. The audit does help in getting the tax returns and their supporting schedules error-free & accurate but the main purpose of the audit is to: 1) Ensure Statutory compliance. 2) Identify Internal Control Weaknesses & get recommendations from experts to improve on it. 3) Improve processes to ensure efficiency and effectiveness. 4) Build capacity of the staff & those involved in the process as they get the chance to interact & learn from them the best in the field. Well, but how to ensure all the purposes are met & ensure that audits are being done for the sake of audit. How to turn it into an opportunity to learn more and use it a driver for constantly evolving change? In other words, how to get more out of the Audit Process? Here's what you can do to get better out of the process: Photo credit: @creativevision

It is true that we cannot always stick to what has been planned or budgeted. There are instances where printers breakdown all of a sudden which now requires immediate repair. As a business, you must have budgeted for it but what happens if the printer becomes unrepairable. It might not be feasible for you to go to stationery shops to get the printouts and you won't be left with an option other than to buy a new one. But, the question is how?  And, believe me! A month doesn't pass by where such unforeseen expense requests/invoices do not appear on your desk for approval. As a business, we should always be ready to manage these. Here's what we suggest: 1) Establish a CONTINGENCY FUND: You can decide the % considering the past trends but we would recommend it be around 2-5% of the total monthly income. Ensure that it is kept separately in the reserve account so that you don't have to borrow or take a loan from the bank to meet the immediate needs. 2) Add a 5-10% buffer/cus