Ad
related to: third party evidence accounting principles
Search results
Results from the WOW.Com Content Network
Audit evidence is sufficient when there is an acceptable amount of evidence found. This changes based on the risk of material misstatement and the quality of evidence that was found. The higher the risk that the financial statements are materially misstated, the more evidence an auditor should collect.
Methods or techniques of audit evidence gathering are classified in 7 categories: 1. Inspection This involves physical examination of supporting accounting documentation, contracts, records and board of director minutes. It also includes physical examination of the assets.
Realizing the need to reform the APB, leaders in the accounting profession appointed a Study Group on the Establishment of Accounting Principles (commonly known as the Wheat Committee for its chairman Francis Wheat). This group determined that the APB must be dissolved and a new standard-setting structure created.
As a result, a third party can express an opinion of the person / organization / system (etc.) in question. The opinion given on financial statements will depend on the audit evidence obtained. A statutory audit is a legally required review of the accuracy of a company's or government's financial statements and records.
The auditor must state in the auditor's report whether the financial statements are presented in accordance with generally accepted accounting principles. The auditor must identify in the auditor's report those circumstances in which such principles have not been consistently observed in the current period in relation to the preceding period.
Financial auditing, and various other English accounting practices, first came to the United States in the late nineteenth century. These practices came by way of British and Scottish investors who wanted to stay more informed on their American investments. Around this same time, an American accounting system was taking root. [19]
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.
Auditor independence is commonly referred to as the cornerstone of the auditing profession since it is the foundation of the public's trust in the accounting profession. [1] Since 2000, a wave of high-profile accounting scandals have cast the profession into the limelight, negatively affecting the public perception of auditor independence.
Ad
related to: third party evidence accounting principles