TQM

1. Total Quality Management (TQM)
Total Quality Management (TQM) is a comprehensive and structured approach to organizational
management that seeks to improve the quality of products and services through ongoing refinements
in response to continuous feedback, and to improve their internal processes and increase customer
satisfaction. When it is properly implemented, this style of management can lead to decreased costs
related to corrective or preventative maintenance, better overall performance, and an increased
number of happy and loyal customers. The principles of quality management:
1. Quality can and must be managed 2. Processes, not people, are the problem 3. Don’t treat
symptoms, look for the cure 4. Every employee is responsible for quality 5. Quality must be
measurable 6. Quality improvements must be continuous 7. Quality is a long-term investment
Total quality management can be summarized as a management system for a customer-focused
organization that involves all employees in continual improvement. It uses strategy, data, and effective
communications to integrate the quality discipline into the culture and activities of the organization.
Customer-focused: The customer ultimately determines the level of quality no matter what an
organization does to foster quality improvement—training employees, integrating quality into the
design process, or buying new measuring tools—
Total employee involvement: All employees participate in working toward common goals.
Continual improvement: A major thrust of TQM is continual process improvement. Continual
improvement drives an organization to be both analytical and creative in finding ways to become more
competitive and more effective at meeting stakeholder expectations.

2. Auditing
An examination and verification of a company's financial and accounting records and
supporting documents by a professional. The purpose of an audit is to form a view on whether the
information presented in the financial report, taken as a whole, reflects the financial position of the
organization at a given date. Audits exist because they add value through easing the cost of
information asymmetry, not just because they are required by law.
What don't auditors do?
 Audit other information provided to the members of the organization, for example, the directors' report.
 Check every figure in the financial report.
 Judge the appropriateness of the organization’s business activities or strategies or decisions made by
the directors.
 Look at every transaction carried out by the organization.
 Test the adequacy of all of the organization’s internal controls.
 Comment to shareholders on the quality of directors and management.
 Objectives
 Add credibility and reliability to
financial reports from the
organization to its stakeholders
by giving opinion on the report
 Evaluate and improve the effectiveness of governance,
risk management and control processes. This provides
members of the boards with assurance that helps them
fulfill their duties to the organization and its stakeholders.
 Coverage
Financial reports, financial
reporting risks.
All categories of risk, their management, including
reporting on them.