Audit and assurance are two related but distinct areas of accounting.

Audit is an independent examination of a company's financial statements, records, and operations by a qualified and independent third-party auditor. The objective of an audit is to express an opinion on the fairness and accuracy of the financial statements, and to provide reasonable assurance that the financial statements are free from material misstatements. Auditors use various procedures, including testing transactions and balances, verifying the existence of assets and liabilities, and assessing the adequacy of internal controls, to arrive at their opinion.

Assurance, on the other hand, is a broader concept that includes audit, but also encompasses other types of engagements that provide stakeholders with a level of assurance over information or systems. These engagements can include reviews, compilations, and agreed-upon procedures, and can cover a wide range of subject matter, such as internal controls, financial forecasts, and compliance with laws and regulations. The level of assurance provided by these engagements can vary, and may be limited or moderate, depending on the scope and nature of the engagement.

Both audit and assurance are important tools for providing stakeholders with confidence in the reliability and accuracy of financial information. Audits are mandatory for many types of businesses and organizations, and can be useful in identifying areas of weakness or inefficiency in operations. Assurance engagements can provide valuable insights into a company's operations and help to identify potential risks or opportunities for improvement.