1. Auditing as a control tool
Point Financial Cost Internal Management
Purpose To verify trueness and
fairness of financial
statements
To check that the
cost accounting
plan is adhered to
To check that the
internal checks and
controls are being
observed
To appraise
performance of
managers
Auditor Qualified CA Qualified ICWA Not necessarily
CA-an expert or
retired employee
Not necessarily
CA- experts in the
field
Appointment By shareholders By Government &
Management
By Board of
Directors
By Management
Nature Mandatory as per
statute. Also known as
statutory audit.
Ordered by the
Central Govt for
specific industries
(44 types)
Otherwise not
mandatory.
Usually optional. Optional.
Emphasis Compliance of
Accounting Standards
in preparation and
disclosure
Efficient use of
resources, control
over costs
Propriety/judicious
ness of decisions,
detection of frauds,
appropriate check
points
Effectiveness of
management
functions
