Types of Auditing

Types of audit - this is a fairly branched concept. For a number of criteria, the types of audit are classified into separate groups. The concept and types of audit vary.

Based on the user's attitude to information , these types of audit are singled out . External (checks with the help of an invited specialist), which includes inspections at the request of the subject of the economy and verification at the request of legislation. The invited auditor conducts an audit on the basis of a contract concluded with the client. The peculiarity of inspections of this type is that the external auditor is a person not interested in the results of inspections (not the founder, not the shareholder, etc.). The purpose of his work is to confirm the reliability of financial statements and to establish the state of economic activity of the entity being audited.

Internal audit is a check conducted by specialists who are subordinate to this economic entity. Internal checks are aimed at solving problems of functional management, ensuring the effectiveness of the economic development of the enterprise and its subordinate structures, and also help employees to perform their work more efficiently.

Proceeding from the attitude to the requirements of the legislation , these types of audit are singled out. When mandatory, the audit is conducted in accordance with the requirements and criteria that the law establishes. Mandatory inspections are conducted with a certain periodicity and pursue the goal of confirming the legality of conducting business operations, their correct reflection in the accounting. Initiative (verification is carried out only at the request of the business entity, its owner or supervisory body of this business entity). The main goal is to identify shortcomings in accounting, reporting , etc. To assist staff in preparing for mandatory verification.

Depending on the object of the checks, there are general, bank, audit of insurance bodies, audit of exchange funds and investment institutions.

Depending on the time of the audit, there are initial, repeat (coordinated) and operational types of audit. The initial is very time consuming and difficult, since it is carried out for the first time at a certain facility.

Depending on the nature of the checks , a system-oriented, audit-confirming and risk-based system is distinguished.

By appointment, audit can be tax, audit of financial and accounting statements, price, operational and management, compliance with requirements and audit of economic activities.

Audit of accounting reporting - verification of reporting for an opinion on its compliance with the criteria for record keeping. Compliance means checking compliance with regulations, laws and regulations. It can be conducted in respect of staff and shareholders. Operational management is conducted to check the functioning of the enterprise units in order to identify efficiency and reliability for management purposes. The tax audit purpose is the relationship of the organization with the tax authorities with regard to payment of taxes and other payments. The special includes technical, environmental and other types of audit.

Types of audit and audit services are divided not only into the main, but also on the accompanying. Auditors have the right to provide related services. These include services that are compatible with audits: accounting, reporting control, tax assessment, financial analysis, evaluation of investment projects, recruitment, various seminars, computerization of accounting, etc. Auditors can also provide services that are incompatible with the conduct of the client's checks: maintenance, restoration of accounting, preparation of tax returns, accounting and financial reporting.