Difference between audit and evaluation
Audit vs evaluation:
The words audit and evaluation mean, on a linguistic level, assessing or processing whereas in an economical sense of the word, it has many dissimilarities which are crucial in distinguishing one from the other. These are two important processes which are of utmost importance to any organization in terms of assessing products, performances and metrics.
What is audit?
While audit is the evaluation of a person, system, organization or product thus performed to determine its validity and authenticity, it also adds value and improves the workings of an organization. Evaluation is considered basically as a learning tool which is thus performed to determine the merits of a system which operates according to a set of standards with the readiness to change the process and alter certain aspects if needed in order to achieve an improved efficiency in the system.
What is evaluation?
Evaluation is basically performed in order to understand a process which will in turn help increase the productivity of the organization. The understanding of a system would eventually lead to understanding of the eminent weak points of a process and through this understanding gained by evaluation, one can make the necessary changes to improve the system. Thus by evaluation, one can achieve greater efficiency in a system through a system of trial and errors.
Audit on the other hand sees to it that the due processes and the functions of an organization are carried out perfectly and according to a predefined set of rules or a predefined standard set by the authorities. Audit checks the system for financial irregularities, efficiency of the staff in reaching the assigned targets, etc.
There are two types of evaluation, formative and summative whereas there are many types of audits: personal, internal, external, statutory, non- statutory, social, performance and final.
Moreover, audits are performed in financial institutions in order to ensure that there are no financial irregularities whereas evaluations can take place in any organization whether it is financial or otherwise in order to judge the efficiency of the system.