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24 Cards in this Set

  • Front
  • Back
is the accumulation and evaluation
of evidence about information to determine
and report on the degree of correspondence
between the information and established criteria
auditing
Auditing should be done by a
competent, independent
is any information used by the auditor
to determine whether the information being
audited is stated in accordance with the
established criteria
evidence
types of audits
operational, compliance, financial statements
1. The need for independence from clients.
2. The importance of a structure to encourage
competence.
3. The increased litigation risk faced by auditors
Three main factors influence the organizational
structure of all firms
The purpose is to assist in providing investors
with reliable information upon which to make
investment decisions
securities and exchange commission
Performs the following services for CPAs:
Sets professional requirements
Conducts research
Publishes materials related to services performed
aicpa
is the worldwide organization
for the accountancy profession that works to improve the
uniformity of auditing practices and related services throughout the world
ifac
The standards for compilations and
reviews of financial statements are
called
Statements on Standards
for Accounting and Review
Services (SSARS).
report on the design
of controls
type I
report on the
operating effectiveness
of controls
type II
stating that nothing
came to the auditor’s attention that would
lead the auditor to believe there was
noncompliance.
negative assurance
1. Report title
2. Audit report address
3. Introductory paragraph
4. Scope paragraph
5. Opinion paragraph
6. Name of CPA firm
7. Audit report date
parts of standard unqualified audit report
report can result from
a limitation on the scope of the audit or
failure to follow generally accepted
accounting principles
qualified opinion
Auditor believes the financial statements are
not presented fairly in conformity with GAAP
adverse opinion
It is issued when the auditor is unable
to be satisfied that the overall financial
statements are fairly presented; can arise only from a lack of knowledge by the auditor
disclaimer of opinion
match levels of materiality with type of opinion
immaterial = unqualified; material = qualified
highly material = disclaimer/adverse
a situation a person
faces in which a decision must be made
about appropriate behavior
ethical dilemma
Professionals should exercise sensitive and
moral judgments in all their activities
responsibilities
Members should accept the obligation to act
in a way that will serve and honor the public
public interest
Members should perform all responsibilities
with integrity to maintain public confidence
integrity
Members should be objective, independent,
and free of conflicts of interest
objectivity and independence
Members should observe the profession’s
standards and strive to improve competence
due care
A member in public practice should observe
the Code of Professional Conduct
scope and nature of services