The document discusses professional auditing standards and an auditor's responsibilities and potential liabilities. It covers the 10 generally accepted auditing standards which fall under general standards, standards of fieldwork, and standards of reporting. The standards address an auditor's qualifications, audit planning and supervision, obtaining sufficient audit evidence, and reporting requirements. The document also defines key terms like negligence, fraud, and breach of contract, and discusses who auditors may be liable to, such as their clients or third parties.
Current Liabilities, Provisions, and Contingenciesreskino1
Current Liabilities,
Provisions, and Contingencies
After studying this chapter, you should be able to:
1. Describe the nature, valuation, and reporting of current liabilities.
2. Explain the accounting for different types of provisions.
3. Explain the accounting for loss and gain contingencies.
4. Indicate how to present and analyze liability-related information
1.)Four Types of Audit Report by Independent Auditors
2.)The Steps to be Done by the Auditors Before They Receive New Engagement With Clients
3.)The Contents Emphasis in the Audit Engagement
The Auditors Responsibilities Relating to Fraud in an Audit of Financial Stat...Dr. Soheli Ghose Banerjee
This presentation is an overview of SA 240 (R). Prepared with Prof. S. Sircar.
Dr. Soheli Ghose ( Ph.D (University of Calcutta), M.Phil, M.Com, M.B.A., NET (JRF), B. Ed).
Assistant Professor, Department of Commerce,St. Xavier's College, Kolkata.
Guest Faculty, M.B.A. Finance, University of Calcutta, Kolkata
Current Liabilities, Provisions, and Contingenciesreskino1
Current Liabilities,
Provisions, and Contingencies
After studying this chapter, you should be able to:
1. Describe the nature, valuation, and reporting of current liabilities.
2. Explain the accounting for different types of provisions.
3. Explain the accounting for loss and gain contingencies.
4. Indicate how to present and analyze liability-related information
1.)Four Types of Audit Report by Independent Auditors
2.)The Steps to be Done by the Auditors Before They Receive New Engagement With Clients
3.)The Contents Emphasis in the Audit Engagement
The Auditors Responsibilities Relating to Fraud in an Audit of Financial Stat...Dr. Soheli Ghose Banerjee
This presentation is an overview of SA 240 (R). Prepared with Prof. S. Sircar.
Dr. Soheli Ghose ( Ph.D (University of Calcutta), M.Phil, M.Com, M.B.A., NET (JRF), B. Ed).
Assistant Professor, Department of Commerce,St. Xavier's College, Kolkata.
Guest Faculty, M.B.A. Finance, University of Calcutta, Kolkata
IT CONTAINS BASICS OF AUDIT AND AUDITOR
MEANING OF AUDIT, DEFINITION, ORIGIN AND DEVELOPMENT, TYPES OF AUDIT, DIFFERENCE BETWEEN ACCOUNT AND AUDIT, AUDITOR
IT WILL HELP THE STUDENTS TO UNDERSTAND THE BASIC OF AUDIT.
What quality control mechanisms should major accounting firms have i.pdfFOREVERPRODUCTCHD
What quality control mechanisms should major accounting firms have in place to ensure that
audit partners have the proper training and experience to supervise audit engagements?
Solution
Quality control measures the major Accounting firm have in place in order to ensure that
auditors have proper training and experience to supervise audit engagements are
(1) Integrity, objectivity and independence: The auditor should be straight forward, honest and
sincere in his approach to his professional work. He should maintain an impartial
attitude and both be and appear to be free of any interest which might be regarded, whatever is
actual effect, as being incompatible with integrity and objectivity.
(2) Confidentiality: The auditor should respect the confidentiality of information acquired in the
course of his work and should not disclose any such information to a third party without The
specific authority or unless there is a legal or professional duty to disclose.
(3) Skills and Competence: The audit should be performed and the report prepared with due
professional care by persons who have adequate training, experience and competence in
auditing. The auditor requires specialised skills and competence along with a continuing
awareness of developments including pronouncements of the accounting body on accounting and
auditing matters, and relevant regulations and statutory requirements.
(4) Work performed by others: When the auditor delegates work to assistants or uses work
performed by other auditors and experts, he continues to be responsible for forming and
expressing his opinion on the financial information.
These are the some of the measures to have proper training and experience to supervise audit
engagements
I WOULD LIKE TO SHARE YOU ABOUT LETTER OF ENGAGEMENT IN SHORT
Letter of Engagement: The legal requirement to get the accounts audited so far extends only to
companies, co-operative societies, and registered societies. In these cases, the respective law
governs the appointment of auditors and their duties. In all other cases, it is a matter of contract.
Thank you hope you might feel it helpfull.
This presentation covers the basic concepts of auditing.
Dr. Soheli Ghose ( Ph.D (University of Calcutta), M.Phil, M.Com, M.B.A., NET (JRF), B. Ed).
Assistant Professor, Department of Commerce,St. Xavier's College, Kolkata.
Guest Faculty, M.B.A. Finance, University of Calcutta, Kolkata
, Business and Finance, ICAB
Icab lectures chapter 10, Business and Finance, ICAB
Icab lectures chapter 10, Business and Finance, ICAB
Icab lectures chapter 10, Business and Finance, ICAB
Internal audit means a continuous critical review of financial and operating matters of a business. In other words, we can say that the audit of a business conducted by the business for a continuous basis. Internal audit is done by the internal staff appointed particularly for the audit purposes. These are called internal auditors.
Ranska. Karkea käännös. Small entity audit standard NP 2010 Lasse Åkerblad
France: New small entity audit standard from July 2017. Based on the ISAs.
Ranska: Pienen yrityksen tilintarkastusstandardi alkaen 7/2017 ja korvaa aikaisemman version. Perustuu ISA:aan.
Auditors independence
Independence of the internal auditor
Independence of the external auditor
Types of independence
Real independence and perceived independence
RELATIONSHIP BETWEEN AUDITING WITH OTHER SUBJECTS
B2B payments are rapidly changing. Find out the 5 key questions you need to be asking yourself to be sure you are mastering B2B payments today. Learn more at www.BlueSnap.com.
Premium MEAN Stack Development Solutions for Modern BusinessesSynapseIndia
Stay ahead of the curve with our premium MEAN Stack Development Solutions. Our expert developers utilize MongoDB, Express.js, AngularJS, and Node.js to create modern and responsive web applications. Trust us for cutting-edge solutions that drive your business growth and success.
Know more: https://www.synapseindia.com/technology/mean-stack-development-company.html
Building Your Employer Brand with Social MediaLuanWise
Presented at The Global HR Summit, 6th June 2024
In this keynote, Luan Wise will provide invaluable insights to elevate your employer brand on social media platforms including LinkedIn, Facebook, Instagram, X (formerly Twitter) and TikTok. You'll learn how compelling content can authentically showcase your company culture, values, and employee experiences to support your talent acquisition and retention objectives. Additionally, you'll understand the power of employee advocacy to amplify reach and engagement – helping to position your organization as an employer of choice in today's competitive talent landscape.
Company Valuation webinar series - Tuesday, 4 June 2024FelixPerez547899
This session provided an update as to the latest valuation data in the UK and then delved into a discussion on the upcoming election and the impacts on valuation. We finished, as always with a Q&A
Digital Transformation and IT Strategy Toolkit and TemplatesAurelien Domont, MBA
This Digital Transformation and IT Strategy Toolkit was created by ex-McKinsey, Deloitte and BCG Management Consultants, after more than 5,000 hours of work. It is considered the world's best & most comprehensive Digital Transformation and IT Strategy Toolkit. It includes all the Frameworks, Best Practices & Templates required to successfully undertake the Digital Transformation of your organization and define a robust IT Strategy.
Editable Toolkit to help you reuse our content: 700 Powerpoint slides | 35 Excel sheets | 84 minutes of Video training
This PowerPoint presentation is only a small preview of our Toolkits. For more details, visit www.domontconsulting.com
Putting the SPARK into Virtual Training.pptxCynthia Clay
This 60-minute webinar, sponsored by Adobe, was delivered for the Training Mag Network. It explored the five elements of SPARK: Storytelling, Purpose, Action, Relationships, and Kudos. Knowing how to tell a well-structured story is key to building long-term memory. Stating a clear purpose that doesn't take away from the discovery learning process is critical. Ensuring that people move from theory to practical application is imperative. Creating strong social learning is the key to commitment and engagement. Validating and affirming participants' comments is the way to create a positive learning environment.
In the Adani-Hindenburg case, what is SEBI investigating.pptxAdani case
Adani SEBI investigation revealed that the latter had sought information from five foreign jurisdictions concerning the holdings of the firm’s foreign portfolio investors (FPIs) in relation to the alleged violations of the MPS Regulations. Nevertheless, the economic interest of the twelve FPIs based in tax haven jurisdictions still needs to be determined. The Adani Group firms classed these FPIs as public shareholders. According to Hindenburg, FPIs were used to get around regulatory standards.
[Note: This is a partial preview. To download this presentation, visit:
https://www.oeconsulting.com.sg/training-presentations]
Sustainability has become an increasingly critical topic as the world recognizes the need to protect our planet and its resources for future generations. Sustainability means meeting our current needs without compromising the ability of future generations to meet theirs. It involves long-term planning and consideration of the consequences of our actions. The goal is to create strategies that ensure the long-term viability of People, Planet, and Profit.
Leading companies such as Nike, Toyota, and Siemens are prioritizing sustainable innovation in their business models, setting an example for others to follow. In this Sustainability training presentation, you will learn key concepts, principles, and practices of sustainability applicable across industries. This training aims to create awareness and educate employees, senior executives, consultants, and other key stakeholders, including investors, policymakers, and supply chain partners, on the importance and implementation of sustainability.
LEARNING OBJECTIVES
1. Develop a comprehensive understanding of the fundamental principles and concepts that form the foundation of sustainability within corporate environments.
2. Explore the sustainability implementation model, focusing on effective measures and reporting strategies to track and communicate sustainability efforts.
3. Identify and define best practices and critical success factors essential for achieving sustainability goals within organizations.
CONTENTS
1. Introduction and Key Concepts of Sustainability
2. Principles and Practices of Sustainability
3. Measures and Reporting in Sustainability
4. Sustainability Implementation & Best Practices
To download the complete presentation, visit: https://www.oeconsulting.com.sg/training-presentations
2. 2.1.WHAT IS AUDITING STANDARDS?
Auditing standards are general guidelines to aid
auditors in fulfilling their professional responsibilities
in the audit of FSs.
They include consideration of professional qualities
such as competence (know how) & independence,
reporting requirements, and evidence.
2
3. 2.2. GENERALLY ACCEPTED AUDITING STANDARDS
The broadest guidelines available to auditors are
the 10 generally accepted auditing standards
(GAAS), which were developed by the AICPA.
10 (ten) generally accepted auditing standards fall
into three categories:
1. General standards
2. Standards of field work
3. Reporting standards
3
4. Cont’d….
4
Generally Accepted Auditing Standards
1. General
qualifications and
conduct
2. Field Work
performance of the
audit
3. Reporting results
1. Adequate technical
training and
proficiency
2. Independence in
mental attitude
3. Due professional care
1. Adequate & Proper
planning and supervision
2. Sufficient understanding
of the entity, its environment,
and its internal control
3. Sufficient competent
evidence
1. Whether statements were
prepared in accordance
with GAAP
2. Circumstances when
GAAP not consistently
followed
3.Adequacy of informative
disclosures
4. Expression of opinion on
financial statements
5. 2.2.1. General Standards
1. Adequate technical training & proficiency.
2. The auditor must maintain independence in
mental attitude in all matters relating to the audit.
3. The auditor must exercise due professional care in
the performance of the audit and the preparation of
the report.
5
6. Due care : means that auditors are professionals responsible for
fulfilling their duties diligently and carefully.
Due care includes consideration of the completeness of the audit
documentation, the sufficiency of the audit evidence, and the
appropriateness of the audit report.
As professionals, auditors must not act
negligently/carelessly or in bad faith, but they are not
expected to be infallible (fail safe).
6
7. 2.2.2. Standards of Field Work
1. The auditor must adequately plan the work and must properly
supervise any assistants.
2. The auditor must obtain a sufficient understanding of the entity and
its environment, including its internal control, to assess the risk of
material misstatement of the financial statements whether due to
error or fraud, and to design the nature, timing, and extent of
further audit procedures. 7
8. 3. The auditor must obtain sufficient
appropriate audit evidence by performing
audit procedures to afford a reasonable basis
for an opinion regarding the financial
statements under audit.
8
9. 2.2.3. Standards of Reporting
The auditor must state in the auditor’s report:
1. Whether the financial statements are presented in
accordance with generally accepted accounting
principles (GAAP) or(International Financial Reporting
Standard) ( IFRS)
2. The audit report must state whether the GAAP has been
consistently applied with that of the preceding period.
9
10. 3. When the auditor determines that informative disclosures
are not reasonably adequate, the auditor must so state in
the auditor’s report.
4. The auditor must either express an opinion regarding
the financial statements, taken as a whole, or state that
an opinion cannot be expressed, in the auditor’s report.
10
11. When the auditor cannot express an overall opinion,
the auditor should state the reasons in the auditor’s
report.
In all cases where an auditor’s name is associated with
financial statements, the auditor should clearly indicate
the character of the auditor’s work, if any, and the
degree of responsibility the auditor is taking, in the
auditor’s report.
11
12. 12
Independences in fact refers to the auditor’s ability to maintain
unbiased and impartial mental attitude or state of mind in all
aspects of work.
Independence in appearance refers to the auditor’s freedom from
conflict of interest, which third parties may infer from circumstantial
evidence.
Factors that May affect the Independency of the Auditor:
1. Investment interest in audit client: - An auditor’s investment in
shares, bonds, mortgage, and notes of an audit client or its
associates, either direct or indirect, may impair independence. Such
an investment is not limited to the auditor but also applies to his or
her immediately family and to partners and their immediate families
13. 13
2. Non audit functions and services: - Certain
functions are incompatible with the auditing function.
These include functioning as a director, officers or
employee of an audit client. The auditor’s
involvement in these functions and services creates a
conflict of interest.
3. Litigation between CPA firm and client: When
there is a lawsuit or intent to start a lawsuit between
a CPA firm and its client, the ability of the CPA firm
and client to remain objective is questionable.
14. 14
Hospitality or goods and services: - This will affect
independence unless it is modest.
4. Undue dependence on income: - If the amount of
income from a client is very large as compared to the total
annual income of the audit firm, independence will be
impaired since the auditors want to maintain this financial
interest.
15. PROFESSIONAL QUALIFICATION REQUIREMENTS
• A professional accountant should perform professional services
with due care, competence and diligence and has a continuing
duty to maintain professional knowledge and skill at a level
required to ensure that a client or employer receives the
advantage of competent professional service based on up-to-date
development in practice, legislation and techniques.
15
16. PROFESSIONAL ETHICS
• All recognized professions have developed codes of professional
ethics. Professional ethics refer to the basic principles of right action
for the member of a profession.
• Professional ethics may be regarded as a mixture of moral and
practical concepts.
• Thus the professional ethics of an accountant would signify his
behavior towards his fellows in the profession and other professions
and towards members of the public.
16
17. Principle of Auditing
1. Integrity: - An accountant should be straightforward, honest and
sincere in his approach to his professional work.
2. Objectivity: - An accountant should be fair and should not allow bias
to override his objectivity.
3. Independence: - When in public practice, an accountant should both
be and appear to be free of any interest which might be regarded,
whatever its actual effect, as being incompatible with integrity and
objectivity.
17
18. 4. Confidentiality: - A professional accountant should respect the confidentiality
of information acquired in the course of his work and should not disclose any
such information to a third party without specific authority or unless there is a
legal or professional duty to disclose.
5. Technical standards: - An accountant should carry out his professional work
in accordance with the technical and professional standards relevant to that work.
6. Professional competence: - An accountant has a duty to maintain his level of
competence throughout his professional career. He should only undertake works,
which he or his firm can expect to complete with professional competence.
18
19. 7. Ethical behavior: - An accountant should conduct himself with a good
reputation of the profession and refrain from any conduct, which might bring
discredit to the profession.
8. Contingent fees:- The AICPA code of professional conduct prohibits a CPA
firm from rendering any professional services on a contingent fee basis.
9. Responsibilities to colleagues:- The auditor should promote cooperation and
good relations with other members of the profession.
10. Advertising: - The advertising should not be false or misleading,” should not
contravene “professional good taste,” should not make “unfavorable reflection on
the competence or integrity of the profession,” and should not” involve a
statement the contents of which” cannot be substantiated.
19
20. LEGAL RESPONSIBILITY AND LIABILITY OF AUDITORS
• The auditor is responsible for his report. The auditor then has
certain duties to fulfill to the users of the financial statements that
he reports on.
• Responsibilities impose liabilities if things go wrong.
20
21. Liable for what?
• The CPA can be sued under the following legal concepts.
(i)Prudent man concept: - The auditor is responsible for exercising due
professional care, and he is subject to lawsuit if he fails to do so.
(ii)Liable for acts of others: - The partners are jointly liable for civil
actions against a partner.
(iii)Lack of privileged communication: - CPAs do not have the right
under common law to withhold information from the courts on the
grounds that the information is privileged.
21
22. Definition of Terms
22
Negligence: is violation of legal duty to exercise a degree of care that an ordinary prudent
person would exercise under similar circumstances with resultant damages to another
party.
Gross negligence: is lack of event slight care. Many jurisdictions consider gross negligence
equivalent to constructive fraud.
Fraud: is defined a misrepresentation by a person of a material fact, known by that person
to be untrue.
Constructive fraud: differs from fraud as defined above in that constructive fraud does not
involve a misrepresentation with the intent to deceive.
Privity: is the relationship between parties to a contract.
23. 23
Breach of contact: is failure of one or both parties to a contract to perform in accordance
with the contract’s provisions.
Proximate cause: exists when damage to another is directly attributable to a wrongdoer’s
or criminal`s act.
Contributory negligence: is negligence on the part of the client that has contributed to his
or her having incurred a loss.
24. Auditor`s are liable to:
24
A. Auditors’ liability to their clients
When CPAS take on any type of engagement, they are obliged to render due
professional care. This obligation exists whether or not it is specifically set
forth in the written contract with the client. Thus, CPAS are liable to their
clients for any losses proximately caused by the CPA’S failure to exercise due
professional care. That is to recover its losses, an injured client need only
prove that the auditors were guilty of negligence and that the auditors’
negligence was the proximate cause of the client’s losses.
25. 25
B. Auditors’ liability to third parties
Bankers and other creditors or investors who utilize financial statements
covered by an audit report can recover damages from the auditors if it can be
shown that the auditors were guilty of fraud or gross negligence in the
performance of their professional duties.
Moreover, the auditors can be held liable for negligence to a limited class of
third parties if the auditors have actual knowledge of such third parties or if
there exists a special relationship between the auditors and the third parties.
The clients (plaintiffs) must prove that they sustained losses, that they relied
on the audited financial statements, which were misleading, that this reliance
was the primate cause of their losses, and that the auditors were negligent.
26. 26
C. Auditors’ responsibility for the detection of fraud and error
The detection and prevention of error and fraud is the management’s
responsibility by designing and implementing appropriate internal
control systems. The auditor is not responsible for the prevention and
detection of error and fraud. The auditor is responsible to design
audit procedures to reduce the risk of not detecting a material error
or fraud, to an appropriate level to provide reasonable assurance.
Accordingly, the auditor must exercise due care in planning,
performing, and evaluating the results of audit procedures.