![]() What is a worrisome consequence under the joint and several liability principle? There are significant scope limitations on the audit. Under which of the following set of circumstances might the auditors disclaim an opinion? There has been a material change between periods in the method of application of accounting principles. Under which of the following set of circumstances might the auditors disclaim an opinion? What are the three main sets of auditing standards used in professional practice by audit firms? International Standards on Auditing, AICPA Auditing Standards, and PCAOB Auditing Standards. What are the three main sets of auditing standards? The 10 standards in the GAAS are grouped into three categories: general standards, standards of field work, and standards of reporting. The primary reason for issuing an adverse audit opinion is that the client’s financial statements contain a pervasive and material unjustified departure from GAAP. Which of the following is the most likely reason for an auditor to issue an adverse opinion quizlet? ![]() Each audit engagement you work on may require you to perform audit work beyond what’s specified in the GAAS in order to appropriately issue an opinion that a set of financial statements is fairly presented. GAAS come in three categories: general standards, standards of fieldwork, and standards of reporting. The auditor must maintain independence in mental attitude in all matters relating to the audit. ![]() Also, he should mention in the report about the extent of responsibility he has taken.General Standards The auditor must have adequate technical training and proficiency to perform the audit. So, he must clearly point out the function performed by him. ![]() The name of the auditor is linked with financial statements. In the latter case, the auditor must explain why he cannot express his opinion about the financial statements of the company. Either the auditor has to state in the report his opinion about the financial statements or mention that he cannot express his opinion in the report. If the auditor finds that the company does not disclose the information adequately, he must mention it in the audit report. They also have to identify the cases or instances in which the company has not followed the rules and the current record is not consistent with the previous one. The auditors have to state in the report that the financial statements comply the Generally Accepted Accounting Standards or not. Then, they are able to give their opinion on the financial statements after auditing. They should conduct an audit systematically to get enough evidence properly. The auditors must understand the timing, regular audit reports and nature of the records. There can be any reason for that, such as mistakes in the record, fraud, etc. It includes internal control because there is a risk of a wrong statement or misinformation of the financial statements. They should have enough understanding of the business entity and the environment of the company. They should supervise the helpers in an appropriate manner. The Standards of Field Work ensure that the auditors do proper planning on how to work. They should perform the audit and prepare the report professionally with great care.They should be mentally independent in all affairs pertaining to audit.General Standards require the auditors to be technically trained and properly conduct the audit.GAAS (Generally Accepted Auditing Standards contains ten standards, which have the following 3 categories: This board introduced GAAS.īack to: Accounting & Taxation How are Generally Accepted Auditing Standards Used? The AICPA (American Institute of Certified Public Accountants) formed a board, commonly called ASB (Auditing Standards Board). They submit the detailed report of the auditors so that their performance can be verified. They make sure that the audit is conforming correctness and compatibility. The audits are of the financial records of the companies. Generally Accepted Auditing Standards generally termed as GAAS is a step by step guideline that auditors use while performing audits. Generally Accepted Auditing Standards (GAAS)
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