Question

Discuss the implication for auditors, clients public and regulations in matters such as: 1. the approach to auditing, 2. Regulations on auditing, 3. Forms of audit reports, 4. Communication of audit matters

Answer 1

Answer :-

The agency's crisis has led to the services of auditors. Shareholders expect the auditors to consult the financial statements presented to them. He described the expected audit gap as a gap between the public's expectations of auditors and the performance of auditors.

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The approach to auditing

Essentially there are four different audit approaches: the substantive procedures approach the balance sheet approach the systems-based approach the risk-based approach. This is also referred to as the vouching approach or the direct verification approach.

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Regulations on auditing

When designing procedures to help to identify non-compliance with laws and regulations, ISA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment requires an auditor to obtain a general understanding of: the applicable legal and regulatory framework.

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Forms of audit reports

• Unqualified opinion-clean report.
• Qualified opinion-qualified report.
• Disclaimer of opinion-disclaimer report.
• Adverse opinion-adverse audit report.

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Communication of audit matters

The auditor should communicate audit matters of governance interest on a timely basis. This enables those charged with governance to take appropriate action. In order to achieve timely communications, the auditor discusses with those charged with governance the basis and timing of such communications.