divorce between the beneficiaries and management
The divorce between the beneficiaries and management has given birth of the Audit. The evolution of modern accountancy and the transformation of auditing profession in Bangladesh and, indeed, in the world as a whole, must be seen in the context of the enormous expansion of industry and commerce, which has been taken place since the Industrial Revolution. While business enterprises were comparatively small and were managed by their proprietors there was little need for the development of complex accounting and auditing procedures. When the scale of operation increased and capital was invested in joint stock companies by shareholder who took no part in the management of such companies it became necessary for the managers to present accounts to the shareholders at regular intervals by means of annual accounts.Audits serve a vital economic purpose and play an important role in serving the public interest to strengthen accountability and reinforce trust and confidence in financial reporting. As such, audits help enhance economic prosperity, expanding the variety, number and value of transactions that people are prepared to enter into Auditing profession helped society to be aware of the consequences of the fraudulent financial reporting by the parties involved in the management. Auditors provide reasonable assurance service to the shareholders by means of expressing an opinion on the financial statements about whether they are reflecting true and fair view of the company. Audit profession, from the very beginning, is providing reliable information to the society hence trying to curtail expectation gap of the society by means of enabling auditing standards and guidelines to the auditors. Audits also provide management with confirmation of excellent performance that can be internally benchmarked by the rest of the organization. Over the passage of time, audit has given the civilization many audit services such as Environment Audit, Value Added Audit, Performance audit