The management audit is more recent concept. It focuses on results, evaluating the effectiveness and suitability of controls by challenging underlying rules, procedures and methods. Management audits, which are generally performed internally, are compliance audits plus cause-and-effect analysis. Management audit requires some additional work. It is a systematic technique of evaluating the operation and effectiveness of the management of a firm. This audit is conducted by an independent auditor or auditing firm, who are experts in auditing. This is done yearly or periodically.
The audit team collects as many facts and information from office records and personal interviews with the personnel of the firm. The team also collects data through questionnaires distributed among the personnel and customers and/or clients of the firm. The team shall submit recommendations to the management for future actions. Management may use these recommendations for controlling the performance and accomplishments of the firm.
According to Ferlyn L. Suvillaga “it is a systematic assessment of methods and policies of an organization’s management in the administration and the use of resources and other more.” From the response of Loria Lyn M. Fernandez “management audit is audit itself but instead of in accounts, it deals with the management.” As explained by Rancy Mendoza “it is the process of determining the individual or group performance in an organization or business.” Based on the statement of Ivey Anne Muncada “it is a systematic assessment of company’s organizational policies and administration.”
After reading a very reliable references, the researcher finally realized that management audit is very important, whether to organization, company or firm. It also requires some additional work because without work we cannot perform such management audit.