What is management audit?
As the term implies, management audit is a system of assessing and evaluating the performance of the management team. In a sense, management audit may be considered the most important audit for an organization, because it is management that is responsible for making an organization what it is and for taking it to its chosen destination.
A good management audit program analyzes the organization's overall position and helps it identify its areas of strengths and weaknesses. It helps management understand the direction and level it is at in relation to achievement of the organization's strategic objectives and helps them take steps to realize these.
A management audit technique usually does its work at a macro level, and seldom works at the level of individual managers. Rather than pointing at individual managers; management audit sees the overall picture.
Purpose of management auditm
Management audit is a metrics-driven approach to understanding where the organization stands in relation to its managerial capability. It helps the organization understand the effectiveness of the management in relation to productivity, marketing, meeting social responsibility obligations and so on. In other words, management audit is a complete checklist of the management's abilities and performances. It helps the organization realize where it stands in relation to the competition, which is why it is said to be a very important audit.
Given the enormity and importance of management audit to an organization, it is understood that it is quite a complex task. It is not the same as auditing any one or more individual areas of the organization. Ideally, management audit should encompass the following:
