The Operational Audit: A Business Appraisal Approach to Improved Operations and Profitability

The operational audit is concerned with the appraisal of company effectiveness, identifying operations which are open to improvement. This paper looks at the history of the operational audit and its relationship to other types of audit. The scope of the operational audit is discussed and so also is the manner in which assignments are typically conducted. Two case studies, one in a sales company and the other in a production company, are presented, and details are provided of the results obtained. The relationship of operational research to operational audit is reviewed, and the benefits of including operational researchers in audit teams are pointed out.