Question

1a. What are the three auditing standards that constitute GAAS? -Discuss

2b. How does a person become a licensed CPA in New York state?-Discuss

Answer 1

1a) Generally Accepted Auditing Standards, GAASrefers to a set of systematic guidelines used by auditors while performing audits on companies’ financial statements, thus ensuring the consistency, accuracy, and verifiability of the actions and reports produced by an auditor.

As explained by Investopedia, by depending on GAAS, auditors can reduce the possibility of missing material info. The Generally Accepted Accounting Standards are categorized into the following sections:

1. General standards include:

i. The auditor must possess sufficient technical training as well as proficiency to carry out the audit.

ii. The auditor must sustain independence (in fact and appearance) in intellectual attitude in every matter associated with the audit.

iii. The auditor should essentially exercise due professional care during audit procedures and the preparation of reports. Moreover, the auditor should assiduously perform the audit and mention the misleading info, if any, in the reports.

2. Standards of fieldwork

i. The auditor should plan adequately the work besides properly supervising any assistants.

ii. The auditor must get sufficient understanding of the company and its environment, also counting its internal control, to evaluate material misstatement risk (either due to error or fraud), and designing the nature, timing, and extent of future audit procedures.

iii. The auditor should get sufficient audit evidence by carrying out audit procedures to give a reasonable basis for an opinion related to financial reports under audit.

3. Standards of reporting

i. It is essential for the auditor to report whether the financial statements are accessible in accordance with GAAP.

ii. The auditor should essentially recognize in the auditor’s report the circumstances wherein such principles have not been observed consistently in the current period as related to the previous period.

iii. On determining the informative disclosures not being reasonably adequate, the auditor should state the same in his report.

iv. It is essential for the auditor to either express an opinion on financial statements or state that an opinion cannot be expressed in the auditor’s report.

2b)Most states require aspiring CPAs to complete at least 150 semester hours of study to become licensed. Students generally accrue 120 hours via a traditional bachelor's degree program. To earn the required 150 hours, some schools offer the option of a combined 5-year bachelor's and master's degree program in accounting.

Thus how he will be a licensed CPA .If he wants to become licensed in newyork then one has to follow the below process.

To become a Certified Public Accountant (CPA) in the state of New York, the regulations are steep to maintain professional integrity. ... After finishing a bachelor's degree CPA.one must complete another 30 credit hours of accounting or business courses. Completing and passing the uniform CPA exam comes next