Review Journal "The Role of The Management Accounting in Financial Auditing Quality Enhancement"

Title	The Role of  The Management Accounting in Financial Auditing Quality Enhancement
Author	Georgescu Iuliana, Betianu Leontina and Macovei Corina
Year	2005

1. INTRODUCTION

accounting is a language of the economic activity and, like any other language, it has its own vocabulary, its own terminology, its own means of expression, conventions and principles and of course its own difficulties. Against this background, accounting theorists define their approach as a philosophy of information supply to support  making the best decisions. Practically, the usefulness of accounting is the criterion that validates the model of organization of a company’s accounting. In the last few years, the evolution to an automated accounting determined a functional integration between financial accounting and administrative accounting. Therefore, the book records of an operation feed a global (joint) database out of which useful information would be extracted for editing the financial reports of the financial accounting and the analysis charts and reports specific to the management accounting.

2. MANAGEMENT ACCOUNTING AND ITS INFORMATIONAL ROLE

The need for information is determined generally by the decisions to be made. Practically, the information produced should observe the three criteria stated by Emery (Emery, 1969:91):

a) an information is valuable for the manager if it contributes to the decrease of

uncertainty of the future;

b) an additional information is valuable if it may affect that decision;

c) an information is valuable if it plays a part in the "sensitive" modification of the consequences of a decision.

3. FINANCIAL AUDIT AND ITS INFORMATIONAL SOURCES

The specialists that authenticate and validate the information provided by accounting, observing the requirements of independence and compatibility with operations and the persons checking them, are called to achieve their mission without being influenced by users’ contradictory interests.

4. PURPOSE AND CONTENTS OF THE FINANCIAL AUDITING 

The general auditing objectives related to balances are more numerous than the management assertions because of the auditor’s need to have available more detailed recommendations for making decisions regarding the samples to collect.

5. POSSIBILITIES OF IMPROVING THE QUALITY OF THE FINANCIAL  AUDITING BY USING INFORMATION OF THE MANAGEMENT  ACCOUNTING

Obtaining correct data on the costs of raw matter, direct labor and production administration is an essential component of cost accounting. To be considered adequate, the cost books should be integrated to the production books and to other books, so that the correct costs are generated for all products. The cost books are relevant for the auditor because the final stock evaluation depends on the proper drafting and use of such records.

6. CONCLUSION

process and synthesize accounting information and the users of this information, it is obvious that the financial audit must re-establish a reasonable confidence between the two categories. Regularly, users of accounting information lack trust in the information provided by the accounting office (external information) because the information producers are not independent from the performed operations and the presented financial statements, which casts doubt on the information objectivity and impartiality.