Sunday, February 09, 2014

Can Internal Audit address cost accounting issues and replace it.

This is one of the falsity advanced by the financial accountants to estopp the blooming of cost accounts.
Unfortunately these individuals and institutions first of all do not differentiate between an accounting function and an audit exercise.
Secondly they often restrict the scope of internal audit to audit of financial transactions and generate another report.
Internal audit is a cross functional exercise of checking the controls and processes that includes its reflection in financial accounting system.
Internal audit is gamut of entity view on the strength of processes and transformation of value.its focus is on the system that generates value.However Internal audit is used to backup statutory audit report.
Cost accounting is an accounting function and cost audit is a scrutiny of such an accounting reflection.There can be a internal audit of cost accounting system as well.