The History and Meaning of Auditing

Audit refers to a systematic examination of the books and records of a business or organization to verify and report on the financial operations and results.

The word 'audit' is derived from the Latin word 'audire', which means 'to hear'.

Auditing is a systematic process that follows a logical and structured sequence of activities. It involves a three-party relationship between shareholders, managers, and auditors. The subject matter of auditing is to provide assurance on a specific subject.

<p>Montgomery defines auditing as a systematic examination of the books and records of a business or organization to ascertain or verify and to report upon the facts regarding the financial operation and the result thereof.</p> Signup and view all the answers

<p>The objective of auditing, as per the definition given by ICAI, is to provide a systematic, independent examination of financial records, irrespective of legal form, whether profit-oriented, with the objective to give an opinion on whether the financial statements present a true and fair view.</p> Signup and view all the answers