Audit

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Audit

An examination of a company's accounting records and books conducted by an outside professional in order to determine whether the company is maintaining records according to generally accepted accounting principles. See: accountant's opinion.

Audit

1. The process of reviewing activities to identify inefficiencies, reduce costs, and otherwise achieve organizational objectives. Audits may investigate potential theft or fraud and ensure compliance with applicable regulations and policies. They also help ensure the accuracy of reports. Audits are an essential part of a company's efficiency.

2. In taxation, the process in which the tax collection agency reviewing the reports of an individual or company to see if all income, deductions, and/or credits reported accurately reflect reality. This is done to ensure that each individual or company pays his/her/its full tax liability. Audits are conducted on a random basis, or when something appears remiss on a tax return. See also: Tax avoidance, Tax evasion.

audit

An examination of an organization's financial documents in order to determine whether the records and reports are valid and the information is fairly presented. An independent audit is usually conducted by a Certified Public Accountant who then issues an opinion as to whether the statements accurately and fairly represent the firm's operations and financial position. See also external audit, internal audit.

Audit.

An audit is a professional, independent examination of a company's financial statements and accounting documents following generally accepted accounting principles (GAAP).

An IRS audit, in contrast, is an examination of a taxpayer's return, usually to question the accuracy or acceptability of the information the return reports.

audit

  1. the legal requirement for a JOINT-STOCK COMPANY to have its BALANCE SHEET and PROFIT-AND-LOSS ACCOUNT (the financial statements) and underlying accounting system and records examined by a qualified AUDITOR, so as to enable an opinion to be formed as to whether such financial statements show a TRUE AND FAIR VIEW of the company's state of affairs and that they comply with the relevant statutes. Auditing involves inspecting documentary evidence of transactions such as INVOICES, STATEMENTS and DELIVERY NOTES to ensure that the DOUBLE-ENTRY accounting entries are complete and authentic.

    Where the auditor is satisfied that the financial statements show a ‘true and fair view’ he will report this to the SHAREHOLDERS in the ANNUAL REPORT AND ACCOUNTS. However, if he is not satisfied that the financial statements show a ‘true and fair view’ or he is unhappy about any explanations given by the managers, then he may make a ‘qualified report’ to the shareholders expressing his precise misgivings.

  2. internal audits of accounting procedures, marketing activities, production operations, quality control systems, and safety may be undertaken to monitor and review the efficiency and effectiveness with which these various activities are undertaken. In addition, a company may undertake a value-for-money audit, to evaluate whether the organization is operating effectively. See also MARKETING AUDIT.

audit

the legal requirement for a JOINT-STOCK COMPANY to have its BALANCE SHEET and PROFIT-AND-LOSS ACCOUNT (the financial statements) and underlying accounting system and records examined by a qualified auditor, so as to enable an opinion to be formed as to whether such financial statements show a true and fair view and that they comply with the relevant statutes. See also ENVIRONMENTAL AUDIT, VALUE FOR MONEY AUDIT.

Audit

An IRS examination and verification of a taxpayer's return or other transactions with tax consequences. An office audit is an audit by the IRS that is conducted in the agent's office. A field audit is conducted by the IRS on the business premises of the taxpayer or in the office of the tax practitioner representing the taxpayer.
References in periodicals archive ?
How COSO Framework Fundamental Concepts Relate to COBIT 5 Framework Components and Content
However, from an auditor's perspective, Burns noted, "Even if we use definitions from the SEC, what is different (in COSO 2013) is the use of the principles.
In terms of integrity and ethical behaviour, one of the main components of the COSO framework, and one that internal auditors don't spend too much time on is the 'control environment'.
For more insight regarding COSO's updated ICIF and transitioning to it, see my article entitled COSO II: The Transition" in the spring 2014 edition of the Pennsylvania CPA Journal.
Editor's note: COSO is a joint initiative of five private-sector organizations, including the AICPA, which provides thought leadership on enterprise risk management, internal control, and fraud deterrence.
COSO is particularly interested in feedback on the clarity and applicability of the guidance in the exposure draft.
Before the COSO Report, it was more common to speak of internal controls (plural) than of internal control (singular).
A project task force, overseen by Task Force Chair Debbie Lambert, COSO Chairman Larry Rittenberg and led by PricewaterhouseCoopers partner Miles Everson, consisted of approximately 20 members with experience in small business.
In making the announcement, Dave Richards, president of the Institute of Internal Auditors and a COSO member, said, "The commission is thrilled to have Dr.
Cerro Coso Community College is the home of the second largest solar farm in California, a photovoltaic field that sits on 6.
Cerro Coso Community College, 3000 College Heights Blvd.