Purposes of Audits
What is an Audit?
A dictionary might say something like “an examination and verification of accounting records and reports,” but a broader and more detailed definition is more appropriate:
An audit is a process or method of providing an independent review and verification that an organization is:
· Providing accurate and reliable financial information and reports,
· Complying with laws and policies,
· Safeguarding its assets,
· Making economical and efficient use of its resources,
· And/or achieving its established goals and objectives.
Why do we need Audits?
As a campus of the California State University (CSU), which is a State agency, San Francisco State University (SFSU) gets most of its funding from the State and Federal governments, and has a fiduciary obligation to ensure that the money is spent on the purposes for which it was allocated to us. We are properly held accountable for how we spend the funds entrusted to us. The State and the Feds have established a lot of rules and regulations for how that funding should be spent. Audits are primary means for assuring the public that their tax dollars are being well and properly spent.
Without audits, there would undoubtedly be much more fraud and waste in all types of organizations. Audits are one form of “checks and balances” to provide some assurance that an organization is not only “doing things right” but also “doing the right thing.”
