Functions of management system audit

 

Management Audit helps management in the setting system and realistic targets. It is the method of

determining the total efficiency of the direction from the top level to the lowest level. It was initially

grown as a tool for investment estimation. It is popularly known as the name of operational

management or efficiency Auditor.

Functions of Management Audit

Management audit is a complex and challenging task. It plays the following functions:

1. Management system audit finds out the objectives of an organization if such objectives are not set up. It furnishes guidance in developing the format and related instructions for each responsibility center's revenue and expense budgets.

2. It evaluates the overall objectives of an organization in small parts. It reviews or gives guidance in preparing complete statements of the performance standards and yardsticks for measurement applicable to each significant decision or performance area.

3. It reviews the organization's structure and assets and decides whether companies goals can be achieved or not. It is essential to examine and refine the units of measurement commonly applied in each central performance or decision place.

4. Inspect all the opportunities of work and liability centers. In this regard, the auditor help management pins down and inter-relating the performance standards and measurements with the functional responsibilities of each person affected.

5. It identifies whether the management team works in the interests of shareholders, employees, and its report.

Management audit gives valuable suggestions to the management after evaluating all the above facts. The board of directors hires independent consultants for doing the duty of the management audit.

6. Customer Feedback Regarding Product and Service Quality

Customer feedback in the form of survey data, interviews, complaint rates, etc., is a vital source of feedback. This information is critical to the audit function. The quality system elements designed to assure product quality (e.g., process control, corrective and preventive action) were probably assessed by the internal audit department at one time or another and found to be acceptable.