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CMA Final · Cost and Management Audit · Evaluation of Corporate Image

While evaluating the corporate image of a listed company, a management auditor reviews its social responsibility and environmental initiatives. Which purpose does this review primarily serve?

The review assesses how the company's behaviour towards society and the environment shapes its reputation and stakeholder trust. CSR and sustainability conduct are visible signals of corporate character, so they form part of image evaluation, unlike trial balance checks, auditor fees or unit cost computation.

  1. AVerifying the arithmetical accuracy of the trial balance
  2. BAssessing how the company's conduct towards society and environment influences its reputation and stakeholder trustCorrect
  3. CDetermining the statutory auditor's remuneration
  4. DComputing the cost of production per unit

Explanation

CSR and environmental conduct are visible signals of the company's character and affect trust among communities, regulators, investors and customers. The review therefore feeds into the image evaluation. Trial balance accuracy, auditor remuneration and unit cost are unrelated to reputation assessment.

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