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is an act of examining books of accounts maintained in government offices in regard
to, the regularity, economy, efficiency, effectiveness and the propriety thereof by the
office of auditor general.

“Government auditing is the act of checking financial and administrative
activities and other miscellaneous processes of government offices,
organizations and program by an independent professional so as to know
whether irregularities, inefficiency and mismanagement is there or not as well
it prepares and provides objectives cohesive and proper report along with
suggestion to improve them.” –UNO

Thus, government auditing is the objective, systematic, professional and independent
examination of financial, administrative and other operation of government office.

Advantages of auditing
Auditing is compulsory task both in government and non-government office. It is
essential for detection of errors and frauds and to prevent such errors and frauds. The
advantages or importance of auditing are as follows:

1. Helps to detect and correct errors: Errors are those mistakes which occur
unknowingly. Errors in books of accounts are the result of either lack of
knowledge of accounting principles or owing to oversight. Some examples
of such errors are – error of omission, error of commission, error principle,
compensating error, duplicating errors, etc. Auditing not only helps to detect
such errors but also helps to correct them.
2. Helps to detect and prevent frauds: Frauds are the mistakes committed knowingly.
It is committed with bad intention. Embezzlement of cash, misappropriation of
goods/assets is common type of fraud that occurs in organization. Auditor should
check the books of account properly and verify every bill, voucher, slip and other
financial documents to ensure the transparency.

3. Helps to maintain books of account regular: It is legal compulsion to keep the
book of account up to date in an organization. If accounts are not maintained
properly, it is questionable.

4. Helps to assess tax: Organizations should pay tax on the basis of volume
of transactions and profit. Only audited financial statement is accepted
as authorized document to determine the exact amount of tax liability of
organizations.

5. Helps in comparison and decision making: Managers should take long-term
and short-term decisions in organization for its advancement. Audited financial

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