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Internal Audit As A Tool In Achieving Organisational Objectives
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1.9 DEFINITION OF TERMS
It
is necessary that clear definitions of some technical terms and words
are given to avoid any possible confusion that may arise because of
their usage.
1) FINANCIAL AUDITING; it is sometimes referred to as
auditing (external) or simply as auditing. The American accounting
committee on basic concepts (1972) has defined it as “a systematic
process of obtaining and evaluating evidence regarding asserting about
economic actions and events to ascertain the degree of correspondence
between those ascertained and established the degree criteria and
communicating the results to interested users.
2) INTERNAL AUDITING;
H. Millichamp (1979) defines it as “independent appraised activity
within an organisation foe the review of accounting financially and
other operations as a basic of services to management. It is a
managerial control, which functions by measuring and evaluating the
effectiveness of other control.
3) INTERNAL CONTROL; The institute of
chartered accountants for England and Wales defined it as “a whole
system of control, financial and otherwise established by the management
in order to carry out the business of an enterprise in an orderly and
efficient manner, ensure adherence to management policies, safeguard the
assets and secure as far as possible the completeness and accuracy of
recordsâ€.
4) AUDIT REPORT; - This is a report prepared by a qualified
accountant and to express the opinion that the accounts show a true and
fair view and comply with statutory requirements.
5) FRAUD; The use of deception for unlawful gain or unjust advantage.
6)
INERNAL CHECK;- it is defined as the allocation of authority and work,
in such a manner as to afford checks on the routine transactions of day
to day work by means of works of the person being proved independent of
another, or the work of one person being complementary to that of
another.
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