What is Audit?

Definition and meaning of audit: An audit is an official verification of accounts and records performed by someone independent of the organization being examined. Audits can be conducted on a voluntary or mandatory basis. In many situations, they are essential to ensuring accuracy and transparency. Examples of audits include those conducted by the Federal Election Commission (FEC) and the Internal Revenue Service (IRS).

There are several types of audits beyond these examples:

• Financial audits examine the accuracy of an organization's financial statements and ensure they are free from material misstatement. 

• Compliance audits determine whether an organization is adhering to regulatory guidelines and legal requirements. 

• Operational audits evaluate the efficiency and effectiveness of an organization's operations and procedures. 

• Performance audits assess whether programs or activities are achieving their intended outcomes. 

• Information system audits review the controls and security of an organization’s IT infrastructure. 

• Environmental audits examine the impact of an organization’s operations on the environment and ensure compliance with environmental regulations.