Management Audit

Management audit is audit of the management. It is similar to operational audit in several aspects. However, management audit concentrates more on the inefficiencies and weaknesses of the management.

The following are the important objectives.

• To identify the weaknesses and inefficiencies of management in different functional areas, such as production, sales, finance etc.
• To analyses the different ways to overcome the inefficiencies, or weaknesses.
• To critically review the organization structure.
• To evaluate the ways for improving the management efficiency and to select the best are the some of the objectives of management audit.

Scope of Management Audit

Management audit may cover a specific functional area or all the functional areas such as. Sales, Inventory, Production, Purchase, Personnel, Finance, Administration, etc.

In management audit, experts from various fields –

• examine the organizational structure, Plans and Objectives, Policies, Systems and Procedures, Methods of control, Standards fixed for performance and the method of evaluation of results.
• report on the defects, weaknesses and irregularities observed by them during their examination.
• make suggestions to improve the efficiency and performance of the management.