General View on Internal Audit of Production Costs

Identifying the costs correctly is primarily important for managerial objectives. An effective and efficient managerial policy is only possible through actual financial data setting the base of decisions to be made. Well defined and true calculated cost elements are essential to determine production costs properly. Considering any expense which is not related with manufacturing, will cause inaccurate cost computation. Aim of this study is to determine the necessary audit procedures to specify and define cost factors properly.