Definition of Auditing
The Institute of Char tered Accountants of India describes audit as “the independent examination of financial information of any entity, whether profit oriented or not, and irrespective of its size or legal form, when such examination is conducted with a view to expressing an opinion there on”.
Spicer and Pegler defines auditing as, “such an examination of books of accounts and vouchers of a business as will enable the auditor to satisfy the Balance Sheet is properly drawn up so as to give a true and fair view of the state of affairs of the business, whether the Profit and Loss account gives a true and fair view of the profit and loss for the financial period, according to the best of his information and explanation given to him as shown by the books, and if not, in what respect he is not satisfied.”
In the words of L.R.Dicksee, “Auditing is an examination of accounting records undertaken with a view to establishing whether they correctly and completely reflect the transaction to which they purport to relate”.
Montgomery defines the term as “Auditing is a systematic examination of books and records of a business or other organization in order to ascertain or verify and to report upon the facts regarding its financial operations and the result thereof”.
The Institute of Chartered Accountants of India (ICAI) is regulating the accountancy profession in India established under the Chartered Accountants Act, 1949 passed by the Parliament of India.