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Auditing Meaning: Definition, Examples, and Translations

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auditing

[ˈɔːdɪtɪŋ ]

Definitions

Context #1 | Noun

financial reporting

Auditing is the examination and verification of a company's financial and accounting records and supporting documents by an independent auditor.

Synonyms

examination, inspection, review.

Examples of usage

  • Auditing helps ensure the accuracy and reliability of financial statements.
  • The auditing process involves gathering evidence to support the financial transactions reported by the company.
Context #2 | Noun

quality control

Auditing can also refer to the process of assessing the quality management systems and practices within an organization to ensure compliance with standards and regulations.

Synonyms

assessment, evaluation, monitoring.

Examples of usage

  • The ISO 9001 standard requires regular auditing of companies to maintain certification.
  • Internal auditing helps organizations identify areas for improvement in their processes.
Context #3 | Verb

action

To audit means to conduct an official examination or review of something, especially financial accounts.

Synonyms

examine, inspect, review.

Examples of usage

  • The government audits businesses to ensure tax compliance.
  • The auditor audited the company's financial statements for accuracy.

Translations

To see the translation, please select a language from the options available.

Interesting Facts

History

  • In ancient Mesopotamia, records were kept on clay tablets, and early forms of auditing existed where officials checked these records for accuracy.
  • The establishment of the 'Certified Public Accountant' (CPA) designation in the U.S. in the late 19th century marked a significant step in formalizing auditing standards.
  • The Enron scandal in the early 2000s highlighted the importance of auditing and led to significant regulatory reforms in the accounting profession.

Science

  • Auditing can be thought of as a scientific method for checking systems, where data collection is followed by analysis to ensure accuracy.
  • In computer science, auditing involves checking and validating the security and integrity of systems, similar to financial auditing.
  • Data analytics tools are increasingly used in auditing to discover anomalies and patterns that might indicate errors or fraud.

Pop Culture

  • Films like 'The Big Short' and 'Wall Street' highlight themes of financial insight and the consequences of poor auditing practices.
  • Auditing as a practice appears in TV shows like 'The Office,' where characters interact with financial challenges that emphasize the necessity of accuracy.
  • Despite its serious nature, auditing has been portrayed humorously, showing the challenges auditors face when working with messy data.

Technology

  • The rise of technology has led to automated auditing software that can process large volumes of data faster and more accurately than manual methods.
  • Blockchain technology is revolutionizing auditing by providing secure and transparent records that simplify the verification process.
  • Cybersecurity audits are crucial today, ensuring that organizations safeguard sensitive information from breaches and attacks.

Origin of 'auditing'

Main points about word origin

  • The term 'audit' comes from the Latin word 'audire,' which means 'to hear.' It originally referred to a process in which a financial report was presented verbally.
  • In the 16th century, audits began to appear in formal legal contexts as governments sought to have accurate accounts of public funds.
  • The word has evolved over time and becomes more associated with written records and accounting practices.

The word 'auditing' originated from the Latin word 'audire', which means 'to hear'. In ancient times, auditors would listen to the oral statements of individuals to verify their accuracy. Over time, auditing evolved into a more formal process of examining financial records and practices. The modern concept of auditing as a systematic review of financial information emerged in the 19th century with the development of accounting standards and professional auditing practices.

See also: audit, audition, auditor, auditorium, auditory.

Word Frequency Rank

Ranked #10,884, this word falls into high-advanced vocabulary. It appears less frequently but is valuable for expressing precise meanings in specific contexts.