Question

Distinguish between management audit and cost audit

Answer 1

Management audit :

It involves the review of managerial aspects like organizational objective, policies, procedures, structure, control and system in order to check the efficiency or performance of the management over the activities of the Company.

Cost Audit :

It represents the verification of cost accounts and check on the adherence to cost accounting plan. Cost Audit ascertain the accuracy of cost accounting records to ensure that they are in conformity with Cost Accounting principles, plans, procedures and objective.

Answer 2

Answer:

➡ cost audit : the verification of cost records and accounts, and a check on adherence to prescribed cost accounting procedures and their continuing relevance. management audit :Systematic assessment of methods and policies of a firm's management in the administration and the use of resources, tactical and strategic planning, and employee and organizational improvement. Its objectives are to (1) establish the current level of effectiveness, (2) suggest improvements, and (3) lay down standards for future performance. Management auditors (employees of the firm or independent consultants) do not appraise individual performance, but may critically evaluate the senior executives as a management team. See also performance audit.

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