Virgin America is a US based airline that began operations specializing exclusively in inland passenger flights between key metropolitan cities in America (Modestus, 2012). Following its launch in 2007, the company has made tremendous progress in terms of clientele base and destination coverage. The airline prides itself of highly qualified staff and first class customer service and care. In the last two years, the government approved Virgin America’s bid to expand its coverage to international destinations such as Canada and Mexico (Modestus, 2012). Despite its profound progress in the American transport business, recent financial analysis reveals that Virgin America’s profit margins tends to diminish instead of rising. In the year 2001 alone, the company incurred a massive loss of 100 million US dollars. The persisting drift towards incurring losses tends to scare potential investors away from the company. Moreover, most financial analysts trace Virgin America’s poor economic performance to floppy internal auditing procedures (Modestus, 2012). In order to rectify the auditing mishaps affecting the overall performance of the company, I decided to prepare a report providing practical solutions that will guarantee enormous profit margins instead losses. However, prior to writing a report, planning is mandatory. The presiding reporting plan briefly discusses the vital sections of the report such as the corrective measures and the anticipated results.
Recently released financial review reveals that Virgin America tends to lose voluminous monetary value when it comes to internal purchases. Just like many other extensive operations, some of the internal purchases go without accountability (Ittonen, 2010). The report cites external auditing as the most efficient system in providing transparency in terms of money transactions. Moreover, the report identifies that the massive losses incurred by Virgin America are direct fruits of already existing poor internal auditing systems. External auditing does not only identify the principal calamities affecting a company, but it also provides constructive criticism that propels a company towards success. Internal auditors, with time, develop mutual loyalty towards the companies that they serve. This loyalty consequently prohibits them from warning their respective companies from wasteful ventures. The report recommends that virgin America employ external auditors who will carefully recheck the work performed by internal auditors (Ittonen, 2010). Similarly, the report reveals that financial statements released by external auditors attain nationwide credentials in comparison to auditing done by internal employees. Since Virgin America is a nascent company with just five-year experience in the American environment, external auditing offers an opportunity for the company to build positive credentials within the American financial market. In summary, the employment of external auditing within Virgin America will ensure that the company achieves its financial objectives while eliminating any constraints that might arise during this voyage to success (Ittonen, 2010).
In addition to citing corrective measures that will steer Virgin America towards its financial success, the report goes further to provide a list of credible external auditors in America (Pickett, 2009). Moreover, the report also cites some of the basic resources required during auditing. Some of the reputable auditing firms recommended by the report include PricewaterhouseCoopers, KPMG and Ernst & Young (Pickett, 2009). Resources required for external auditing include financial statements and company’s accounting policies. Prior to conducting an external audit, there are certain legal obligations that both the company and the auditing firm in question should fulfill (Pickett, 2009). The report used financial reviews and the company’s financial statements in acquiring information published in the report. In terms of data analysis, the report employed quantitative statistics in comparing the profit margins attained by Virgin America during five years of operations. The report forecasts that employment of external auditing will not only provide credibility to Virgin America it will also attract potential investors to the company. This plan achieves its mandate of providing an overview of the actual report.