Advanced auditing Essay Example | Topics and Well Written Essays - 2500 words

Advanced auditing - Essay ExampleRob Gray tries to identify the scope of social accountancy as the preparation and worldly concernation of an account about an organisations social,surroundal,employee,community, customer and other s ca-caholders interactions and activities and where possible the consequences of those interactions and activities With the increase in the business activities backed by globalization, business enterprises thrust started locating their harvest-tideion facilities across the world, breaking cross border barriers. Such a rapid development, many a times will result in the firms overlooking their social obligations in the interest of maximizing their profits. Hence there has been a good deal of efforts being taken to devise the techniques that measure the role of an enterprise to the society. These developments may be considered as the result of the increasing realization of the Social Responsibilities of the enterprises and it becomes necessary that the pe rformance of these enterprises should be seen in the context of their fulfilling their social obligations.According to George Clark What is nowadays coming to be called Social Auditing is similar in many ways to Financial Auditing except that it is about everything else that an organisation does apart from handling money.There has been a number of proposals put forth to design an extended score system that measures the social performance of an enterprise. Linowes has proposed the preparation of a Socio-Economic Operating Statement (SEOS) to show the discordant social costs and benefits of actions of enterprises.This statement proposes to indicate monetary values of various actions of an enterprise classified in to following categoriesRelations with people - to include items resembling training programmes for handicapped workers, contribution to schools for employees, extra costs incurred in hiring persons from minority or suppressed communities. These items would constitute the contribution of the enterprise in improving the relations with the people. The detriments that demand to be shown may be items like postponement of installing safety devices etcRelations with Environment - monetary values of improvements and detriments are to be listed and the net outcome shown separately.Relations with Products - In a similar way, monetary values of improvements and detriments are to be listed.Since there is yet to be a significant development to take place in this area, many of the existing models aim at measuring the performance of an enterprise vis--vis the society tales into account the factors like human resource contribution, public contribution, environmental contribution, product or service contribution and net income of the enterprise.1.2 Environmental AuditAn environmental audit is a means by which businesses can treasure the environmental impacts of their operations. At its core is the measurement and evaluation of all inputs and outputs from the prod uction process. (Australian Government) In the context of the increasing emphasis on protection of environment, environmental accounting and auditing have assumed special importance in recent years. Environmental Accounting aims at measuring the impact of the activities of an organization on the environment. The resultant product is the environmental statement, containing the following among other things to be asserted by the managementA brief description of the activities of the organization and the effect of such activities on the environment as envisaged by the organizationA description of the organisations environmental policy, programme and management systems to implement the stated policiesA summary of the figures of emissions which may cause defilement of air and water, waste generation, consumption of raw material, energy, water and other significant environmental aspects. There should also be presented a comparison of such info with the legal norms if any