Audit and accounting are two distinct but closely related financial processes that play a critical role in managing a company's financial affairs, ensuring compliance with regulations, and providing stakeholders with accurate and reliable financial information. Here's an overview of each:

Accounting:

1. Recording Financial Transactions: Accounting involves the systematic recording of all financial transactions, including income, expenses, assets, and liabilities. These transactions are typically recorded in financial statements like the balance sheet, income statement (profit and loss statement), and cash flow statement.

2. Bookkeeping: Bookkeepers and accountants maintain records of financial transactions, ensuring they are accurately recorded in the company's accounting system. This process includes categorizing expenses, tracking revenue, and reconciling accounts.

3. Financial Reporting: Accountants prepare financial statements on a regular basis, often quarterly or annually, to provide an overview of the company's financial performance and position. These reports are used by management, shareholders, investors, and other stakeholders to assess the company's health.

4. Tax Compliance: Accounting also plays a crucial role in managing a company's tax obligations. Accountants calculate and report taxes owed to governmental authorities, ensuring compliance with tax laws.

5. Budgeting and Forecasting: Accountants assist in creating budgets and financial forecasts, helping companies plan for future financial needs and make informed decisions.

Audit:

1. Objective Assessment: Auditing is an independent and objective assessment of a company's financial statements and internal controls. It is typically conducted by external auditors, although some companies perform internal audits as well.

2. Verification of Accuracy: Auditors examine a company's financial records, transactions, and accounting practices to ensure that they are accurate and in compliance with accounting standards and regulations.

3. Internal Controls: Auditors assess a company's internal controls, processes, and procedures to identify weaknesses or areas where fraud or errors may occur. They provide recommendations for improvement.

4. Financial Statement Audits: One of the primary functions of external auditors is to conduct financial statement audits. This involves verifying that the financial statements present a true and fair view of the company's financial position and performance.

5. Compliance Audits: In addition to financial statement audits, auditors may conduct compliance audits to ensure that a company is adhering to specific laws, regulations, or industry standards.

6. Reporting: After completing an audit, auditors issue a report that summarizes their findings. This report may include an opinion on the accuracy of the financial statements and any identified weaknesses in internal controls.

7. Transparency and Trust: Auditing provides assurance to stakeholders, such as investors and creditors, that the company's financial information is reliable and can be trusted. It enhances transparency and accountability.

In summary, accounting involves the day-to-day recording and reporting of financial transactions, while auditing is an independent assessment that verifies the accuracy and reliability of financial statements and internal controls. Both functions are critical for maintaining the financial health of a company, ensuring compliance with regulations, and building trust with stakeholders. External audits, in particular, provide an unbiased evaluation of a company's financial practices.