auditor

Examples of auditor in the following topics:

• Additional Items: Auditor and Management Reports

  • When an audit is performed on a company, the auditor issues a formal opinion in the form of an auditor report.
  • If a company has an audit performed, whether by an internal auditor or an outside auditor, the auditor issues a formal opinion.
  • This opinion takes the form on an auditor report .
  • Please note that the Securities and Exchange Commission requires an audit by an outside auditor.
  • In business, the auditor report is consider an essential component of the financial statements.

• Uses of Financial Reports

  • There has been legal debate over who an auditor is liable to.
  • In Canada, auditors are liable only to investors using a prospectus to buy shares in the primary market.
  • In the United Kingdom, they have been held liable to potential investors when the auditor was aware of the potential investor and how they would use the information in the financial statements.
  • Nowadays, auditors tend to include in their report liability restricting language, discouraging anyone, other than the addressees of their report, from relying on it.
  • Liability is an important issue: In the UK, for example, auditors have unlimited liability.

• Internal Controls

  • To conduct a cycle count, an auditor will select a small subset of inventory, in a specific location, and count it on a specified day.
  • The auditor will then compare the count to the related information in the inventory management system.
  • If the numbers differ, the auditor will take additional steps to determine why the counts do not match.

• Full-Disclosure Principle

  • An opinion is said to be unqualified when the auditor concludes that the financial statements give a true and fair view in accordance with the financial reporting framework used for the preparation and presentation of the financial statements.
  • An auditor gives a clean opinion or unqualified opinion when he or she does not have any significant reservation in respect of matters contained in the financial statements.

• Managing to Prevent Fraud

  • To meet financial goals for the company managers may be tempted to "cook the books. " To help prevent management from adjusting financial statements, an independent auditor should examine financial statements on an annual basis.
  • To meet financial goals for the company managers may be tempted to "cook the books. " To help prevent management from adjusting financial statements, an independent auditor should examine financial statements on an annual basis.

• Gain Contingencies

  • For example, an auditor expresses an opinion on whether financial statements are prepared, in all material aspects, in conformity with generally accepted accounting principles (GAAP).

• Reasons for a Conceptual Framework

  • The Financial Accounting Standards Board (FASB) is a private, not-for-profit organization whose mission is "to establish and improve standards of financial accounting and reporting for the guidance and education of the public, including issuers, auditors, and users of financial information. " Created in 1973, FASB replaced the Committee on Accounting Procedure (CAP) and the Accounting Principles Board (APB) of the American Institute of Certified Public Accountants (AICPA).

• Defining Accounting

  • ., financial accounting) purposes, and subsequently also in accounting and disclosure regulations, following a growing need for independent attestation of external accounts by auditors.
  • Accounting that concentrates on reporting to people inside the business entity is called management accounting and is used to provide information to employees, managers, owner-managers, and auditors.

• Standard-Setting Groups: SEC, AICPA, and FASB

  • The FASB's mission is "to establish and improve standards of financial accounting and reporting for the guidance and education of the public, including issuers, auditors, and users of financial information. "

• Ethical Considerations

  • Also, SOX increased the independence of the outside auditors who review the accuracy of corporate financial statements and increased the oversight role of boards of directors.