Procurement plays an important role in all businesses. The procurement department is responsible for securing the resources needed by the company. Also in charge of spending the company’s capital, a well-run procurement department follows processes to ensure integrity each time a purchase is made. An audit reviews the procurement process to reduce fraud and offer suggestions for improvement. While audit procedures vary among organizations, there are several key procedures included in all procurement audits.
Procurement auditing is an independent examination of the procurement records and procedures of a procuring entity to ascertain or verify whether they give true and fair view and report the findings regarding procurement operations. Financial Accounting is the recording, classifying and summarizing events of an economic entity in order to assist management in decision making.
Differences between procurement audit and accounting
| Points difference | of | Procurement Auditing | Accounting | ||
| 1. Definition | It is the critical examination of the procurement transactions recorded in the procurement records to verify they give true and fair
view |
It is recording of all the day to day transactions in the books of accounts leading to preparation of Accounting records. | |||
| 2. Nature | It is concerned with establishment of
reliability of procurement records. |
It is concerned with finalisation of accounts. | |||
| 3. Objects | The object certify correctness procurement records |
is | to the of | The object is to ascertain the trading results. | |
| 4. Process | Audit of
procurement process and records |
Audit of financial
statements and procedures |
| 5.
Commencement |
Procurement Audit begins when
Accounting ends. |
Accounting commences when book
keeping ends. |
| 6. Scope | It depends upon the agreement or upon the provisions of procurement law. It goes beyond procurement
records. |
It involves various Accounting records. It involves maintenance of books of accounts. It does not go beyond books of accounts. |
