Employee of company
A company
Financial audit of company
All of the above
Answer is Right!
Answer is Wrong!
The correct answer is D. All of the above.
An employee of a company cannot be appointed as a cost auditor because they have a conflict of interest. They may be biased in their reporting and may not be objective. A company cannot be appointed as a cost auditor because they are not independent. They may be tempted to manipulate the results of the audit to make themselves look good. A financial audit of a company is not a cost audit. A cost audit is a specific type of audit that focuses on the costs of a company.
Here are some additional details about each option:
- Employee of company: An employee of a company cannot be appointed as a cost auditor because they have a conflict of interest. They may be biased in their reporting and may not be objective. For example, if the employee is trying to get a promotion, they may be tempted to report that the company’s costs are lower than they actually are.
- A company: A company cannot be appointed as a cost auditor because they are not independent. They may be tempted to manipulate the results of the audit to make themselves look good. For example, if the company is trying to get a loan, they may be tempted to report that their costs are lower than they actually are.
- Financial audit of a company: A financial audit of a company is not a cost audit. A cost audit is a specific type of audit that focuses on the costs of a company. A financial audit focuses on the financial statements of a company, such as the balance sheet and income statement. A cost audit focuses on the costs of a company, such as the cost of goods sold and the cost of labor.