Different type of Audit

 Different type of Audit

External audit :external audit is that which is critical review of the representation of the published financial statements it is compulsory for all company’s which are listed in the stock exchange.

Internal Audit: this is a review of operation carried out sometimes continuously specially assigned staff with in the client business.

Concurrent audit is a systematic and timely examination of financial transaction on a regular basis to ensure accuracy, compliance with procedure and guidelines.

Management audit

A detailed audit that concentrates on analysis and evaluation of management procedures and the overall performance of an organization. A management audit is undertaken to discover weaknesses and to institute improvements within the organization. Also called operational audit, performance audit.

Development audit

·   A development audit is an internal assessment of your fundraising program and your readiness to embark on new

development ventures.

·   The development audit is a review of past and current fundraising practices and programs and establishes a

framework for future development efforts.

·   The development audit looks at involvement of staff, board and volunteers in your fundraising program and offers

 recommendations on how to increase the effectiveness of your human resources.

·   The development audit evaluates the strengths and weaknesses of your development system including your computer

hardware and software and offers recommendations to improve your system.

·   The development audit helps you look at your program from the donor's point of view and offers suggestions to

improve your donor communication and stewardship.

Financial audit
Financial audit or more accurately, an audit of financial statements, is the review of the financial statements of a company or any other legal entity (including governments), resulting in the publication of an independent opinion on whether those financial statements are relevant, accurate, complete, and fairly presented. Financial audits are typically performed by firms of practicing accountants due to the specialist financial reporting knowledge they require. The financial audit is one of many assurance or attestation functions provided by accounting and auditing firms, whereby the firm provides an independent opinion on published information. Many organisations separately employ or hire internal auditors, who do not attest to financial reports but focus mainly on the internal controls of the organization. External auditors may choose to place limited reliance on the work of internal auditors.

AUDIT VS INSPECTION

An inspection is different than an audit. The tools are similar, but the processes and how they are conducted make them different. An inspection generally uses a checklist format with “yes/no” answers. The question is asked or the item on the checklist is evaluated, and it either passes the inspection or does not. “Shades of gray” very seldom come into the picture during an inspection. Inspections are usually performed in a very short timeframe (usually between 10 minutes and an hour), and they usually focus on a single item or process.

Audits, however, are more detailed and in-depth, they can take several hours or several days, depending on the scope and depth of the audit. Audits will look at an entire process from start to finish, and include reviews of written procedures and observation of tasks as well as an inspection of the equipment and processes to which the written procedures apply. Audits frequently include interviews with employees and document reviews to assure that the steps an operator actually takes are in line with the written procedure (do the procedures say what the operators do, and do the operators do what the procedures

says). Additionally, if a procedure is based on a regulatory requirement, an audit will evaluate a written procedure to assure it meets the requirements of the regulations. With an audit, there is frequently a question checklist that determines if the topic “meets compliance”, “needs improvement”, “does not meet compliance” or is “not applicable”.

Audit tools will generally be more “squishy” to allow for the auditor to probe deeper into the process to determine if it complies, and to what degree it complies. Audit tools and questions are seldom in a yes/no format, and the tools are designed so that auditors ask open-ended questions that allow for the operator to elaborate on what they do and how they do it. Audit findings are generally more detailed in nature and point out specifically what is required and what parts of the process are out of compliance (hence the availability of the “needs improvement” determination).