Final answer:
Managerial accounting is not typically subject to GAAP standards or external audits since it focuses on internal reporting for decision-making. Instead, companies may have internal controls and perform internal audits to ensure accuracy and reliability of their managerial accounting information.
Step-by-step explanation:
The question pertains to the requirements under Generally Accepted Accounting Principles (GAAP) for managerial accounting practices and whether audits are necessary for managerial accounting reports. Managerial accounting is primarily concerned with providing information to internal management for decision-making, planning, and control purposes. As such, managerial accounting reports are not typically subject to GAAP standards; GAAP is more relevant for financial accounting which deals with the preparation of financial statements for external parties such as investors, creditors, and regulatory agencies. Moreover, managerial reports are not generally audited in the same manner as financial statements. However, companies may establish internal controls and might conduct internal audits to ensure that managerial accounting information is accurate and reliable for internal use.