This article discusses the definition of legal audit, its objectives, principles, and implementation.

Legal audit is a thorough examination from a legal perspective conducted by legal professionals.

There are many forms of legal audit. For example, legal audit is carried out in the process of company acquisition or merger. Legal audits can also be carried out for the purposes of periodic legal compliance of a legal entity. In fact, legal audits can be carried out in government institutions.

Legal audits are carried out by professionals in the legal field, such as legal consultants or legal audit institutions. With a legal audit, material information or facts will be obtained that can describe whether the company has fulfilled all aspects related to rules and laws.

Audit law must be carried out carefully and thoroughly with respect to data and facts such as the physical condition of the company, completeness of documents, and the condition of the transaction object. In connection with the process, there are many important documents that must be examined, including the following:

  1. Articles of association of the company;
  2. Documents regarding company assets;
  3. Agreements made and signed by the company with third parties;
  4. Documents regarding company permits and approvals;
  5. Documents relating to company staffing issues;
  6. Documents regarding company insurance;
  7. Documents regarding company taxes;
  8. Documents relating to whether or not the company is involved in lawsuits and/or disputes both inside and outside the court.

After carrying out a legal due diligence, the legal consultant then prepares a Legal Audit Report, which is a document containing facts, information, and other information regarding the legal aspects of a company or transaction object. In general, it is also accompanied by opinions and suggestions for improvement for the company in the future.