MEANING AND DEFINITION OF PERIODICAL AUDIT
Periodical Audit is also known as Annual Audit or Final
Audit or Complete Audit. This type of Audit is usually done at the end of the
year after the preparation of the Final Accounts. The Auditor does the audit
work till the time all the account books and statements prepared are verified
and his staff. This type is examined by him or an Audit is done only once a year.
Such an audit is most suitable and satisfactory as well as practical for small
organizations. However, extensive examination of Account Books is not possible
under such an audit.
"Periodical Audit is that which starts at the end of the financial year concerning to the Audit. It does not have the advantages of Continuous Audit."
Lawrence R. Dicksee,
"Periodical Audit means
such Audit which does not start before the close of the financial year and
continues till the time the audit work
is completed."
Walter W. Bigg,
ADVANTAGES OF PERIODICAL AUDIT
Periodical Audit has
the following advantages:
(1) Saving of Time-
In such Audit the Auditor comes to the organization
for audit work only at the end of the year. He does the audit work in less time
and this sutits the organization also.
(2) No Chance of the Figure's Alterations-
Unlike Continuous
Audit, in Periodical Audit there is no possibility of making alterations in the
figures in the account books, as the audit is done only after the finalization of
the accounts.
(3) Economical-
Periodical Audit is quite economical since the audit fees charged by the
Auditor are comparatively less as also the organization has to bear the expenses
of the Auditor's staff only once a year.
(4) Continuity in Work-
Periodical Audit does not disturb the smooth and routine working of the
commercial organization. The audit work does not obstruct in any manner the
accounting work, because the old books are closed and they are replaced by the
new books of account. This process does not come in the way of the smooth
working of the organization.
(5) Advantages to the Auditor-
Periodical Audit is also
advantageous to the auditor since he gets all the account books, vouchers, and
necessary information at a time. He thereby is able to complete his work
without loss of time. He can also take up the audit work of other organizations
simultaneously.
