Question

14. Internal audit is
a) Compulsory for a company with paid-up capital of Rs. 25 lakh and above
b) Voluntary for a company
c) Not necessary for a company
d) Necessary for a company​

Answer 1

Answer:

b) Voluntary for a company

Explanation:

Internal auditing is an independent, objective assurance and consulting activity designed to add value to and improve an organization's operations.

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Answer 2

Answer:

Option b - voluntary for a company is a correct answer.

Explanation:

• Internal audits examine a company's internal controls, such as corporate governance and accounting procedures.
• These audits guarantee that rules and regulations are followed and that financial reporting and data collecting is accurate and timely.
• An internal audit assesses the efficacy of a company's internal controls, corporate governance, and accounting systems and provides risk management.
• Internal audits provide a value-added service to management and the board of directors by catching and correcting problems in a process before external audits.

Hence, Internal auditing is a company's choice, for the better and smooth running of the company continuous monitoring is necessary and this can be overcome by internal audits.

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