Audit

Explanation: An audit is an official inspection of an organization’s accounts, typically by an independent body. It ensures the accuracy and compliance of financial records and statements according to accounting standards and legal requirements.

Example: An external audit firm reviews your construction business’s financial statements annually to ensure they accurately represent your financial position.

Potential Issues: A poorly conducted audit can miss significant discrepancies, leading to undetected errors or fraud. This can have legal implications and damage stakeholder trust.