Question

What information is provided in the auditors’ report? Does the audit report offer any guarantees? Explain. What do you think the general public believes the auditors are providing in the audit report?

Answer 1

In USA , Auditors are required to include in the scope paragraphs a pharse stating that they conducted auditing their audit in " in accordance with generally accepted auditing standards in the United states of America. And in opinin paragraph state whether financial statements are presented in conformity with generally accepted accounting principles in the united states of america.

Components of Auditors Report

The auditor's letter follows stanadrd format . as established by generally accepted auditing standards . A report usually of three paragraphs
  

* The first paragraph states the responibilty of the auditors and directors
* The second paragraph contains the scope , stating that a set of standards ccounting practices was guide
* The third paragraph contains the auditors opinion

Auditor report doesnt provide any guarantee . It provides only reasonalbe assuranec . Because it is not a investigation . Due to the lack of time auditor do sample analysis he will not check 100% transaction . He provides the report based on several methods . Auditor doesnt give absolute assurance he will give only reasonable assurance . So Auditor's providing no gurantee.

Based on the Auditor's opinion  general public assumes about the perforance of the company . If auditor gave unmodified opinin , public feel that company is dioing good . And company not involved any fradulent activities and directors taking the company in good way