Auditing, a Necessary Activity within an Entity
DOI:
https://doi.org/10.18662/upalaw/90Keywords:
entity, management function, audit, well-functioningAbstract
Auditing, if we speak of the internal one, represents an instrument, a sub-function aspect of organizing the firm and of financial-accounting function, based on supporting the entrepreneur, CEOs/managers in order to allow them a better management of the activities. This kind of audit is considered the final level of the internal control system of the entity.
In this paper, we are focused on the impact of auditing activity on corporative governance, better said, within the managerial microeconomic system.
Corporative governance defines principles, rules, norms, regarding the management of an entity, on behalf of present and potential shareholders, in order to reach the targets. Audit interferes to ensure the control and the well-functioning of the company (firm, entity).
We sustain that, for corporate governance, the auditing committee means an improvement of the quality of financial activity, especially, and performing relations with the business environment (in this case with the external auditors and other entities).
A very important problem to be underlined regarding this sub-function, is that the planning, preparing and ongoing activities within a company (entity) have to be realized more and more based on the evaluation of risks associated to auditing activity and, due to the recommendations made by the auditors to ensure added value.
From the different companies’ auditing practice, we consider this domain defining the microeconomic status and indispensable activity for a correct analysis of the managerial functions of an entity.
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