Section: Principles of Management

24) A/An ________ is a formal evaluation of an organization's financial statements, performed either by an outside accounting firm or by an internal department.

1. incident log
2. rating scale
3. revenue operating budget
4. financial audit
5. balance sheet budget

An audit is when either an external accounting firm or an internal auditing department performs a formal evaluation of an organization's financial statements. A company may also perform a management audit which is when they review their goals and the status of the plans operating to achieve these goals.