Operational auditing

Concept

Operational Audit is a systematic review of effectiveness, efficiency and economy of operation. Operational audit is a future-oriented, systematic, and independent evaluation of organizational activities. In Operational audit financial data may be used, but the primary sources of evidence are the operational policies and achievements related to organizational objectives.[1] Operational audit is a more comprehensive form of an Internal audit.


The Institute of Internal Auditor (IIA) defines Operational Audit as a systematic process of evaluating an organization's effectiveness, efficiency and economy of operations under management's control and reporting to appropriate persons the results of the evaluation along with recommendations for improvement.

Objectives

  1. To appraise the effectiveness and efficiency of a division, activity, or operation of the entity in meeting organizational goals.
  2. To understand the responsibilities and risks faced by an organization.
  3. To identify, with management participation, opportunities for improving control.
  4. To provide senior management of the organization with a detailed understanding of the result

Advantages

Disadvantages

Steps of Operational Audit

Generally Operational Audit involves following five steps;

  1. Preliminary preparation
  2. Field Survey
  3. Audit Programme Development
  4. Audit Execution
  5. Reporting and Follow-up

References

  1. "Operational Audit". daf.csulb.edu. 2011-12-22. Retrieved 2013-12-28.

See also

This article is issued from Wikipedia - version of the Friday, June 19, 2015. The text is available under the Creative Commons Attribution/Share Alike but additional terms may apply for the media files.