It is traditional to think of an audit in terms of the annual checking of a company or
business accounts. The financial compliance audit evolved in the twentieth century as
business practices became more complex (Arter, 2000). Often the undertaking of a
financial audit will provide an increase in confidence that the company’s business is
being conducted in an honest and appropriate manner. This enhancement of credibility
was picked-up by the quality profession in 1940s (Arter, 2000) and first applied to the
military and then, in 1960s, the nuclear power industry. The implementation of a
quality inspection regime by the military was a reaction to accidental explosions of
munitions in factories (Seddon, 2000). Indeed, the recent history of auditing has often
been heavily influenced by adverse events (Cangemi and Singleton, 2003).
It is traditional to think of an audit in terms of the annual checking of a company orbusiness accounts. The financial compliance audit evolved in the twentieth century asbusiness practices became more complex (Arter, 2000). Often the undertaking of afinancial audit will provide an increase in confidence that the company’s business isbeing conducted in an honest and appropriate manner. This enhancement of credibilitywas picked-up by the quality profession in 1940s (Arter, 2000) and first applied to themilitary and then, in 1960s, the nuclear power industry. The implementation of aquality inspection regime by the military was a reaction to accidental explosions ofmunitions in factories (Seddon, 2000). Indeed, the recent history of auditing has oftenbeen heavily influenced by adverse events (Cangemi and Singleton, 2003).
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