According to Taylor and Perry, management audit is “a method to evaluate the efficiency of management at all levels throughout the organization, or more specifically, it comprises the investigation of a business by an independent body from the highest executive level downwards in order to report as to its efficiency or otherwise, with recommendations to ensure its effectiveness where such is not the case.”
The objectives of management audit may be summarized as follows:
(a) Whether the basic aims and objectives of the enterprise are being fulfilled in practice.
(b) Whether the enterprise is being successful in adapting itself to technological change;
(c) Whether the management structure is suitable
(d) Whether the policies with regards to staff recruitment and training are adequate and whether staff morale is satisfactory.
(e) Whether there is a proper communications system both upwards and downwards throughout the enterprise, including a proper management information system.
(f) Whether the return on capital employed is adequate and how it compares with other companies in the same industry.
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