ECONOMY, EFFICIENCY, EFFECTIVENESS AND ITS RELATIONSHIP WITH AUDIT MANAGEMENT

Economy

Utilization of something of value such as cost, time, energy, or other valuable. Economic concept ensures that the cost of the inputs used in the operation of the organization can be minimized.

Efficiency

Efficiency relates to how the company conducts its operations, so that the achieved optimization of available resources. Efficiency relates to the working methods (operations). In conjunction with the concept of input-process-output, efficiency is the ratio between output and input. How big is the output produced by using a certain number of inputs owned by the company? Good working method will be able to guide the process of running operations by optimizing the use of resources of the company. Thus, efficiency is a measure of a process that connects between the input and output of the company's operations.

Effectiveness

Effectiveness is the end product of an activity (operation) which has reached its destination, both in terms of quality of work, quantity of work and deadline targets

In brief definition of effectiveness can be understood as the level of success of a company to achieve its objectives. Is the implementation of a program / ​​activity has achieved its objectives? Effectiveness is a measure of output.

input-process-output

Audit management aims to identify activities, programs, and activities that still require improvement, so that the recommendations given will be achieved improvements over the management of the various programs and activities of the company. The emphasis of the management audit is directed primarily at the various objects audits that if it can be improved in the future will come, as well as prevent the occurrence of many losses.

The management audit sees that efficiency is used as a standard assertion that the standards can be implemented to reduce the risk. Effectiveness and efficiency in a company should also look at the safety of the workers, how companies that also pay attention to their employees in order to improve effectiveness and efficiency. The decline in corporate performance is demonstrated by the achievement of corporate profits, high customer complaints, high employee turnover, and so on, an indication that the company's management needs to be improved. These issues must be resolved. Audit management through the stages of the audit, to assess accurately the process (management) that have occurred, identify weaknesses and recommend improvements for the shortage.