What is the difference between accountancy and auditing

Auditing is a sub-field of accounting; therefore, they do have some similarities. At the end of every financial cycle, accountants produce the financial statements from account balances and trial balances of the company. These are used to determine the financial position of the company. Auditors will only come in after the reports are produced to check the statements and identify any potential errors.

This process is to ensure the financial statements are credible and reliable. Accountants must record daily transactions, and the process cannot be paused. On the hand, auditors check the financial statements on a periodic basis usually monthly, quarterly, or yearly. In other words, auditing only takes place after the accountants complete their work.

Although internal and external audits are different, the knowledge is transferable. Therefore, it is common to see auditors switch between external to internal auditing.

Moreover, they both ensure the validity of financial statements. That being said, the difference between internal and external audit can be significant:. They also help an organization to increase its efficiency by detecting any internal problems.

However, internal auditors who are normally employees of the company might be too close to the business due to their position within the company. External auditors are always from an external audit firm to ensure they are unbiased. However, they both are very much different in their scope of work and operability. The difference between Accounting and Auditing is that accounting means to maintain the financial statements of a company while auditing means to check whether the financial statements maintained by the company are accurate.

Accounting is conducted for daily transactions while auditing is conducted quarterly or annually. Accounting refers to the process of keeping the updated records for every financial transaction i. Accounting also referred to as the language of business as every business is measured in terms of certain figures or numbers and these numbers are prepared by the means of accounting.

In simple terms, accounting can be well understood with the help of following questions that gives specific numbers,. Auditing is the process of checking, verifying, and evaluating the financial statements of the organization. As financial statements are prepared with the help of accounting records, thus auditing also covers the checking of those accounting records on a sample basis.

It assesses the reliability and validity of the accounting information of the organization that is represented by the means of financial statements. Auditing starts when the process of financial accounting is completed and financial statements are prepared for the given year.

Auditing can be termed as a post-mortem activity. It is internal i. Reports Accountancy: Accountant is not required to submit the report on the financial statements prepared by him. Remuneration Accountancy: An accountant is remunerated in the form of salary. Commencement of work Accountancy: Accountancy starts where Book-keeping ends.

Related Topics Introduction to Audit. Meaning of Auditing. Definition of Auditing. Features or Characteristics of Auditing. Book-Keeping, Accountancy and Auditing. Relationship of Auditing with other Disciplines. Auditor: Meaning, Functions, Qualities. Objectives of Auditing. Advantages of Auditing.