The audit is that the annual inspection process of a corporation or organization. Under which the income-expenditure and other data associated with the corporate is monitored. The audit process is completed by the corporate and also by the tax department. Income by professional accountant by the corporate Expenditure data is examined to see the expansion of the corporate. While the target of an audit of the tax Department is to look at the taxation related processes of the corporate.
An audit may be a very legal right for any company or organization. Under this process, the aim of checking the books of accounts is to properly assess the business of the corporate and check the specified tax. The businessman or company determines its annual income and expenditure through an audit process. The profitability of the corporate is additionally revealed supported the known results. Talking about the method of tax, any company is taxed consistent with its profits. The most objectives of the audit process include eliminating data errors, preventing irregularities within the organization and rectifying the mistakes made.
Types of audit:
As it is obvious from the above definitions that audit of audit data is named audit. Under this process, the annual growth of any institute is assessed. Now realize the sort of audit. If we glance at the audit mainly There are two types.
Internal audit: Under this process, a corporation or company calculates its annual loss or profit. This process is completed by the institution of its designated staff CA or sometimes it’s examined from outside through independent audit agencies. This process is often done on a half-yearly basis. But once a year, books of accounts are compulsorily checked.
External Audit: This sort of audit process is usually conducted by the Tax Department. The aim of assessing errors in payment of tax-related liabilities of the corporate. These actions are taken when the tax Department is corrected by a corporation relative to its profits. there’s a suspicion of non-payment of tax.