Audit and Assurance are both essential aspects of evaluating the financial health and credibility of an organization. However, they serve slightly different purposes. Here’s an overview of both:

Audit

An audit is an independent examination of financial information and records of an entity. It aims to ensure the accuracy, reliability, and compliance of financial statements with established accounting standards and regulations. Audits are conducted by external or internal auditors and can be required by law, especially for publicly listed companies.

Types of Audits:

1. Internal Audit: Conducted by internal employees or departments to assess the efficiency of processes, risk management, and internal controls.
2. External Audit: Performed by independent auditors to verify that financial statements provide a true and fair view of the organization’s financial status.
3. Statutory Audit: Mandatory by law for certain entities, such as public companies, to meet legal and regulatory requirements.
4. Forensic Audit: Conducted to detect fraud, embezzlement, or any illegal financial activities.