ch.6 auditing
by mai mohamed
1. l.o1: objective of audit f/s
1.1. provide opinion that the f/s is fairly stated
1.2. steps for audit: 1- understand obj. and respons. for the audit. 2- divide f/s into circles/ cycles. 3- mgmt assertions 4- general - specific audit. obj.
2. res. of
2.1. mgmt:
2.1.1. adopting suitable acc policies and principles
2.1.2. internal control
2.1.3. fair presentation in the f/s
2.1.4. why mgmt respo.
2.1.4.1. because mgmt operates the bus, daily acts.
2.1.4.2. and the auditor knowledge is limited to the acquired
2.2. auditors resp. according to AICPA
2.2.1. f/s fairly presented. reasonable assurance not absolute, express his opinion
2.2.1.1. why reasonable
2.2.1.1.1. depends on sample
2.2.2. report his opinion in f/s and the icofr "internal control over financial reporting"
2.2.3. discover material misstatement
2.2.4. differentiate bet. error and fraud