Audit

The systematic examination of records and documents and the securing of other evidence by confirmation, physical inspection, or otherwise, for one or more of the following purposes: determining the propriety or legality of proposed or consummated transactions, ascertaining whether all transactions have been recorded and are reflected accurately in accounts; determining the existence of recorded assets and inclusiveness of recorded liabilities; determining the accuracy of financial or statistical statements or reports and the fairness of the facts they present; determining the degree of compliance with established policies and procedures relative to financial transactions and business management; and appraising an accounting system and making recommendations concerning it.

An inspection of the accounting records and procedures of a business,government unit or other reporting entity by a trained accountant, for thepurpose of verifying the accuracy and completeness of the records. It may beconducted by a member of the organization (internal audit) or by an outsider(independent audit).