The auditing of foreign companies

Audit of a foreign company is a verification of financial statements, accounting and tax records of a foreign organisation, representative office or branch of a foreign enterprise operating in the territory of the Russian Federation.

Proper organisation and maintenance of accounting and tax records give business owners and senior managers some guarantees and allow to be confident in the lawful implementation of the company's activities. In addition, only reliable and transparent reporting of the enterprise provides an opportunity to objectively assess the profitability and success of the business, helps to make correct strategic decisions and, importantly, avoids penalties from the supervisory authorities.

However, the possibility of accounting and tax mistakes cannot be completely eliminated, especially when foreign companies are involved. Reporting of foreign representations has its own peculiarities, and only professionals with extensive experience in this field are able to keep an accurate record.

Therefore, the activity of foreign enterprises in the territory of Russia is inextricably connected with foreign trade operations, contracting, where a foreign company acts as a counterpart. Tax record and accounting for such transactions has its own specifics and requires from the specialist extensive knowledge not only of Russian, but also of international financial law.

Thus, the main objectives of auditing a foreign company are to identify and correct errors and inaccuracies in the recording of business transactions and to verify the reliability of reporting. In other words, a foreign company may be audited for:

During the audit, all documents of the company are thoroughly analysed, violations are identified and effective ways of their elimination are selected.

When auditing foreign organisations, it is determined to the extent that their activities comply with the requirements of civil legislation, existing accounting and tax standards. For this purpose, our specialists check:

Depending on the type and purpose of the audit, the list of audit objects may be reduced or extended. The composition, timing and cost of the work of the auditors are determined before the contracting after the request for services.

On the basis of the audit of the representative office of a foreign company, a report and an audit report are drawn up, in which:

If necessary, the specialists of our audit company advise the heads of a foreign organisation on financial and legal issues arising during the implementation of activities in the Russian Federation, give recommendations to the staff of the financial department, concerning the correctness and completeness of accounting and tax records.