Difference Between Audit & Investigation Essay Example for Free

Difference Between scrutinize Investigation EssayInvestigation is the act of detail interrogation of activities so as to achieve accepted objectives. Specially, probe is made in suspected places. It finds out the nature and reasons of suspected areas but studying is the act of examining books of accounts so as to prove true and fairness of operating results and fiscal position of a business. Following differences erect be seen between size uping and investigation1. Purpose An canvas is carried out for the purpose of ascertaining whether or not the eternal rest sheet and profit and loss account show true and fair view of the state of companys personal business and its profit or loss. But an investigation aims at establishing a fact or is carried out for nigh particular purpose i.e. to know the financial position of the concern or the earning capacity of the concern etcetera2. On Behalf An audit is carried out on behalf of the proprietor of the business, while an inve stigation may be conducted on behalf proprietors when they suspect any fraud in their business or on behalf of outside parties who wish to alter money or intend to purchase business or at the instance of the government on the request of the shareholders.3. Scope An audit includes solely an examination of the accounts of a business whereas an investigation covers not only an examination of the accounts but also an inquiry into other relevant matters connected with the purpose for which it is undertaken.4. Use Of Techniques An audit is usually a test checking but an investigation is a much more thorough examination of the books of accounts. It goes into the depth of the problem and keeps on looking for far more definite evidence to arrive at a conclusion that it can firmly substantiate. Further, investigation may be conducted even after the audit of the accounts.5. Period An audit is related to only a year or six months while investigation may cover several years.6. Statutory Obligat ion In the case of joint stock companies, audit is compulsory under law while there is no such statutory obligation with construe to investigation.7. Examination Use Of Policies In audit, an auditor has to see whether the methods of valuation and other accounting policies have been consistently followed or not and he has to ensure that all disclosures have been properly made in the financial statements, while an investigation is not at all bound by accounting conventions, policies and disclosure requirements.