What is an audit?

An audit is an evaluation of an organization's financial and other policy documents. They are usually performed to determine if full and complete records are being maintained and whether these records can track all income and expenses as well as justify that funds have been spent in following the appropriate guidelines. The audit also assures the owner and any other interested party that the reports are valid and reliable. Audits may be performed internally (conducted by an organization's employees, typically to prevent fraud or assess internal controls) or externally (performed by outside parties to ensure objectivity - the outside parties are usually certified public accountants who write an opinion how accurately and fairly financial statements represent an organization's financial position)