Accounting Essay Help
An auditor is defined as a person designated and authorized to examine accounts and accounting records, compare the costs with vouchers, check all elements of balance sheet and income statement and state the result. However, the auditing is a systematic review of the books, accounts, records and supporting documents of an organization to determine whether the financial statements present a true picture of concern. The auditor has a significant role in each and every organization as they report on the figures and results and drafted by the management as to their correctness and fair presentation.
The auditor has the responsibility to perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement, whether initiated by errors or fraud. Due to the nature of the evidence and the characteristics of fraud the auditor is able to obtain reasonable, but not absolute, level of assurance that material misstatements are detected. The auditor is not responsible to perform the audit to obtain reasonable assurance about misstatement, caused by errors or fraud, which are immaterial to the financial statements are detected. [Paragraph added effective for audits of financial statements for periods closed from December 15, 1997, by Statement on Auditing Standards n. 82.] Auditor responsibilities require essentially the duty to ask certain questions i.e. to make inquiries, obligation to submit a report to the company over the examined accounts, the duty to make a proclamation in terms of estimated provisions, the detection and prevention of fraud, the duty to report fraud and duty to an important clarification. To provide credibility to accounts and reports, therefore, the auditors should examine the documents available through for the detection mistakes, reveal fraud, detect any irregularity or misleading report, and evaluate the effectiveness of the system of internal control in place.
The objective of the proposed standards is to require standard accounting professionals acquire specific skills (e.g., professional knowledge, skills and professional values, ethics and attitudes) they need to perform their work as competent audit professionals. A number of sources are involved production of regulation of the audit, including national legislation, international norms, standards and professional organizations and bodies. The proposed standard is applicable not only to auditors (i.e. engagement partners with ultimate responsibility for the audit report), but also those who have a significant interest in the undertaking of the audit and are responsible for making decisions important process contributing to the overall audit opinion. Audit professionals must also, of course, filled the prescribed conditions IES 1-7 by International Education Standard for Professional Accountants. In the definition as proposed it is clear that an audit professional must be a professional accountant (i.e., a person who is a member of a body of members of the IFAC) satisfying the requirements of IES, 1-6.
Purpose that before an individual can assume the role of a professional audit, you must first qualify as a professional accountant (i.e. whether it would satisfy the requirements of IES 1-6), licensee and those with more knowledge, skills, practical work experience, values, ethics and attitudes prescribed by the regulations. This proposed standard recommends for professional expertise and knowledge required for an auditor plus what IES 2 prescribed for professional accountants. This additional knowledge is key three domains: audit of financial statements; accounting and financial reporting; and information technology. Knowledge must be at an advanced level, which is deeper than anticipated of professional accountants. Proposed standard describes the implementation and development of skills for audits of financial statements. Proposition standard requires that individuals have an internship/relevant before they have a significant involvement in a mission of verification of the financial statements. They can acquire this experience either before, during or after qualification as a professional accountant. This practical experience should be obtained under the supervision of an auditor in an appropriate organization. The experience should be in sufficient depth and duration to allow individuals to demonstrate that they have the skills and competencies required in the proposed standard. It is anticipated that, before assuming the role of a professional audit, skills and competencies of individuals are evaluated. This assessment can be made by a member body of IFAC, a third person (as a place of work evaluator, government or regulatory authority), through the process of reviewing the same level of the member organization, a firm quality control systems or a combination of these. Certain member organizations are likely to include the requirements as proposed by this standard during the qualification period. In that case, people would be considered professional auditors while qualifying for professional accounting and evaluation could be carried out immediately before qualifying.