ROLE AND IMPORTANCE OF THE AUDIT OF OPERATIONS IN PRIVATE AND PUBLIC SECTOR

Abstract

Considering that in theory and practice, there are three types of audits (audits of financial statements, audit of operations and audit review of compliance with the rules and regulations), this paper focuses on the definition of audit operations, which the Republic of Srpska and the Federation of Bosnia and Herzegovina have not enough researched and presented to the public. Since the review of operations represents the type of audit that examines the organizational unit for evaluating the success of its operations, the focus is on determining the economy, efficiency and effectiveness (the concept of "3E"), pursuant to which the auditor becomes aware that the observed organizational unit operated in a given time period. In this regard, the audit of operations can be observed in the private and public sector, which is the focus of research in this paper. In addition, this paper particularly explains the characteristics and the nature and methods of audit of operations. The primary objective of this paper is the evaluation and improvement of economy, efficiency and effectiveness in the private and public sectors, through operations audit approach.