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5 Benefits of Performing a Company Audit

company auditAn annual legal audit of your company might not be on the top of your to-do list, but it should be. They are an important protective measure to ensure that your business runs smoothly.

Here are the top five benefits of performing a legal company audit.

Confirm that your entity is correctly and legally established.

When you legally audit your company, one of the first areas you should examine is your corporate structure.[2] You want to make sure your business is incorporated with the appropriate business entity, and you want to ensure you are following the guidelines for that entity. Since paperwork and keeping notes can be a large part of the work behind some business entities, now is also a good time to review your company’s notes and the actions of your Board.

Review decisions the Board made and decide whether or not they handled the situation appropriately. If they did not, make notes regarding what they should do the next time such a situation should arise.

Secure your intellectual property.

Thoughts and ideas are just as important to protect as physical products. This is why it is a good idea to review the names and logos, as well as any advanced concepts or ideas your company is using to do business, and make sure they are registered to you. A little bit of work here could possibly keep you out of a courtroom in the future, or allow you to collect statutory damages, and legal expenses if you should have to enforce your intellectual property rights.[3]

Make sure the rights and responsibilities of your employees and contractors are clearly defined.

Setting expectations for employees and contractors is important for your staff to produce good results. It is also critical for the protection of the source of value in your business, like your systems or your list of customers or clients, that you have agreements in place that enable you to enforce your rights. By reviewing documents like your employment contracts, service agreements, and policy handbook, you can protect your business from risk and enable yourself to enforce your rights.

Assess risk of lawsuits in the future.

If you have any potential lawsuits, now is a good time to review the facts with your attorney. Could you recover if you were to prevail? Is it worth the trouble? What could you change to avoid a similar issue in the future? Input from your attorney is particularly valuable here, as it can greatly reduce the likelihood of future lawsuits.

Maintain compliance with applicable regulations.

Above all, you want to make sure your company is staying compliant. By staying compliant, your business will be prepared for government inquiry, potential investment, and other legal obstacles. If you are unsure of all the benefits for your company by staying compliant, check out this article.

Who Can Perform a legal audit?

In order to achieve the most thorough company audit, you should make sure to hire a licensed professional third party, who does not work for your company. This outsider will be able to analyze your operations with no bias or judgement. At J. Muir & Associates, we can do your audit for you. Give us a call today at  786-533-1100 or contact us online to learn what we can do for you.

 

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