Difference between Audit and Accounting(Accounting and finance)

Definition of Accounting and Auditing

Accounting includes tracking, reporting, and analyzing financial transactions. It covers everything from the preparation of individual tax returns to the preparation of the financial statements of international organizations and is considered a basic discipline in the field of accounting.

An audit engages in performing actions to attain audit proof about the quantity and revelation obligations of GAAP. In the U.S., the Financial Accounting Standards Board (FASB) and the Government Accounting Standards Board (GASB) set up and preserve these items.

The Origin of Auditing

Although existing records of government research in the 11th century BC in China and the 4th century BC in Greece, the current research emerged in the 19th century when public works involving large-scale global financial movements conducted independent and meaningful audits of financial management concepts.

In Great Britain, the Office of the Comptroller-General was created in 1857, and in 1921, the U.S. Build a U.S. General Accounting Office (formerly Government Accountability Office in 2004).

Audit systems continue to emerge and have been attacked more than once, shortly after the collapse of Enron, Worldcom, and their auditing firm, Arthur Andersen, in the early 2000s, and pursue the fall down of Wall lane in 2008.

Types of Audit

The financial statements determine whether the entity's financial statements reflect the entity's operating performance and financial position while complying with generally accepted accounting principles.

Compliance audit determines whether an entity has complied with applicable laws and regulations that may affect the financial statements. Financial audits and compliance are often combined.

Economic and efficiency research determines whether an organization manages economically and efficiently and utilizes resources such as labor, space, and assets; causes of any problems in this area; and if the organization has complied with the laws and regulations of the area.

System test results look for a specific program to determine if the desired results or benefits are available and that the desired results can be obtained at a lower cost.

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