Question

What, in your opinion, is the role of a qualified auditor? Based on the knowledge you have gained in this subject, do you think that auditors play a useful role in financial markets? Explain your answer.

Answer 1

An auditor is a professional, he is qualified to conduct an audit of the company so as to evaluate the validity of company's financial statement. A qualified auditor plays wide variety of roles. These are:

• He has to certify whether the company is following proper accounting practices or not.
• To form an opinion about the reliability of financial statement.
• To provide an audit report.
• To make proper inquiry by assessing books of accounts, vouchers and other information and explanation from the company.
• To see whether all the disbursements are made as per law.
• To verify all assets and liabilities and their upkeep.

The auditors also play an important role in financial market. These are:

• To evaluate the validity and reliability of a company's financial statement. This helps shareholder's to evaluate the investment that will be beneficial for them. There actions impact the stocks and overall financial standing of the company.
• To draw attention of the management to the shortcomings in the operations of the company's.