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Introduction to Floating interest rate note (FRN) or floater

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Introduction to  Floating interest rate note (FRN) or floater Powered By Docstoc
					**BUK**RG

Auditing is the systematic critical examination done by one person or group of persons
independent from the system audited.

Although there are many types of audits, the term is generally used to designate the external
audit of financial statements. Which is carried out by a professional in accounting to comment
on the reasonableness of the information contained in the books and their compliance with
accounting standards.

Often an audit should also serve to detect general problems or a need for improvement, so that
they can be removed. Whenever possible, corrective measures or improvements are initiated.

The basic requirement for an audit is the independence. In auditing, this entails: Independence
of Mind: The mental state that can provide an opinion without being affected by influences which
compromise professional opinion; allowing a person to act with integrity and exercise objectivity
and professional scrutiny.

Audits may be carried on any activity, originally arising from the need for companies to validate
their economic information from a service or an independent company. In large companies there
is usually an internal audit department, but there are also numerous companies dedicated to
auditing.

The audit of financial statements includes examining the information contained therein by an
independent auditor. The purpose of this review is to determine whether they were prepared in
accordance with current accounting standards applicable in each country or region.

Within the field of quality management there are two types of audits: In static quality, the
character examination audit is implemented since it sheds light on compliance of set standards.

They are therefore carried out only once per scan cycle. In the dynamic quality assurance they
serve in the detection of trends and provide important feedback to the initiators on the
effectiveness of measures taken.

The strength of the accompanying audit increases with the repetition rate at which the identical
issue of the affected group will be submitted to the same topic.

In the case of mergers and acquisitions, the buyer needs to know in detail the state of affairs of
the company to be acquired. The basic function of due diligence is to evaluate the assets and
liabilities of the target company, researching relevant aspects of its past, present and
foreseeable future.

Due diligence allows the company to evaluate progress, assess assets and liabilities, examine
its legal issues such as contracts and statutes, enforcement of existing laws, trademarks,
intangible assets. As well as assessing the risks of the business contingent, current and future
trials determining the existence of actual, potential or hidden liabilities, and assess intangible
assets like human capital, knowledge, business culture, leadership, etc.

As regards performance of work, a report is compiled from comments and observations which
will serve as a basis for negotiating a final agreement on issues such as potential contingent
risks, terms of warranties, etc. There are various types of audits carried out in different fields
and these include:

    - Financial audit: scrutiny of financial transaction records for truth, accuracy and compliance
with standard accounting principles
    - Compliance audit: verification of compliance with a set of rules or questions
    - Performance audit: objective and systematic review of the achievement of objectives /
effectiveness, and whether the resources used for this purpose have been used economically
and efficiently
    - System audit: assessed on a management level
    - Process audit: assessment of individual operational processes
    - Product audit: evaluation of products based on customer expectations
    - Project audit: evaluation of the progress of a project
    - Media audit: verification of compliance to guidelines or rules in relation to media activities

				
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