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Difference between Accounting and Auditing?
Difference between Accounting and Auditing?
3 Answers
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Accounting and auditing are closely related but serve different purposes. Accounting involves the systematic recording, analyzing, and reporting of financial transactions for a business. It's the process that ensures a company's financial statements accurately reflect its operations and financial position.
Auditing, on the other hand, is the examination and verification of those financial statements by an independent third party. The goal of auditing is to ensure that the financial records are accurate and comply with accounting standards and regulations. While accounting focuses on the day-to-day financial activities, auditing provides an objective assessment, offering credibility and confidence to stakeholders about the accuracy of the financial information.
In essence, accounting is about creating financial records, while auditing is about validating those records. Together, they ensure transparency and trust in a company's financial health.
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Shortly it can be said that "Auditing is the process of verifying accounts".
Both are the branch of commerce and can be studied and practiced at a professional level individually.
Audit is the review and verification of books of accounts so maintained by the organisation keeping in mind the Standards of Auditing (SA). In India the Standards of Auditing are formulated and amended by Auditing Assurance Standard Boards (AASB)
Accounting on the other hand is the process of recording data and information through proper vouchers and document in the books of accounts to ascertain the current financial position of the organization and for other stake holders as well. Principles of Accounting Standards are followed which are formulated and implemented by ICAI
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There is a far difference between auditing and accounting. however, they both come under the study of commerce.
Audit
An audit involves the review of the accounting books of the corporate. Associate degree audit could also be done through rhetorical accounting, or conducted by the corporation itself. If the corporate is listed on a securities market, the audit is sometimes done by a politician freelance body.
The audit method is an associate degree in-depth examination of every monetary dealing created by a corporation and encompasses the full year-end accounts. Upon the completion of the freelance audit, the books and accounting procedures are verified as correct.
Accounting
Accounting involves handling the daily monetary transactions for the corporate. This includes terribly numerous functions starting from the incoming earnings to the outgoing payments. Some accounting functions embody the bills or payments sent to vendors.
It conjointly includes the money, check, MasterCard and electronic payments received from customers; and checks written and received by the corporate. Payroll and tax deductions, at the side of the adaptive of the corporate books for the year, are all accounting processes.
"hope this was informative"
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0Thanks for the information. Anonymous User | 6 years ago