Audit Challenges in Sole Proprietorship and Partnership: A Study on Objectives, Technology Integration, and Auditor Outlook

Abstract: In small business organisations, especially partnerships and sole proprietorships, auditing is essential to maintaining financial integrity, legal compliance, and long-term company viability. However, these organisations frequently lack standardised record-keeping, formal internal controls, and specialised compliance resources, which presents serious difficulties for auditors. This research examines how auditing methods are changing in these kinds of organisations, with particular attention to the main goals of auditing, new issues that arise, technological integration, and the growing role of auditors. The study gathers information from practicing auditors at different levels through a mixed-method approach that includes structured surveys and observational data. The results show that the complexity of financial transactions, poor documentation, and client-side delays all seriously impair audit efficiency. Tight deadlines, changing compliance standards, and growing demands for advising support—particularly in the wake of recent MSME Act amendments—also put a great deal of pressure on auditors. Technology, especially accounting software like Tally 5.0, has become a game-changer by automating reporting processes, facilitating real-time access to financial records, and simplifying data entry. However, organisational inertia and deficiencies in user training frequently hinder its successful usage. The survey highlights a significant change in the role of auditors, from typical compliance officers to proactive consultants who help small business owners navigate finance and regulatory environments. This study comes to the conclusion that improving audit quality in small business settings necessitates a multifaceted strategy, including the development of standardised audit procedures suited to informal business structures, increased client communication, ongoing professional development, and the broad adoption of audit technologies. When combined, these tactics can strengthen the audit function and promote small businesses' long-term growth and resilience.