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CS Professional · Compliance Management, Audit and Due Diligence · Concepts of Various Audits

The board of Kaveri Foods Pvt Ltd asks a professional to review whether its purchase function is operating economically, efficiently and effectively, and to suggest improvements, without giving any opinion on true and fair view. This engagement is best described as:

The engagement is a performance audit. It evaluates economy, efficiency and effectiveness of a function such as purchasing and recommends improvements, rather than giving an opinion on true and fair view of financial statements or checking legal compliance.

  1. APerformance auditCorrect
  2. BStatutory audit
  3. CSecretarial audit
  4. DTax audit

Explanation

Performance audit assesses economy, efficiency and effectiveness of an activity. Statutory audit gives a true and fair opinion; secretarial audit checks compliance with corporate laws; tax audit reports on tax-related particulars. The scenario describes none of these.

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