Details Title: ASSURANCE Description: auding flashcards theory Total Flash Cards: 32 Created: 01/19/2009 13:58:00		New Users: To study from this flashcard set, or to create your own your own study flash cards, REGISTER HERE. Existing Users: CLICK HERE. Additional Management Flashcards
Cards in this set: Term who can do auditing? name 3 organizations? Definition you have to belong to an organization including: CICA CGA CMA institute of auditors information systems and audit and control association Term what is and adudit (impoartant) 3 important things Definition the accumulation and avaluation fo evidence abuot information to determine and report on the degree of correspondence between the information and established criteria (important do not believe the nubmers on balance sheet and income statemnt are right; balance statemtn not true value of firm and auditors do not create financial statements) Term 5 key components of auditing Definition 1. quantifiable info 2. GAAP Criteria 3. evidence cathering 4. competant independent person 5. report Term Factors that affect demand for audits Definition - remotemenss of info - bias and motives of provider - volumnious data - complex exchabnge transactions - perceived benefit and loss Term Auditing can reduce ______ risk associated with financial statements. The risk that the ffinancial statements are _____ Definition information innaccurate Term three types of audits Definition 1. financial audits 2. compliance audits 3. operational audits Term most common type of audit Definition financial audits Term financial audits Definition determine if financial statments are in accordance with GAAP Term compliance audit Definition to determine whehter auditee is following specific procedures to rules set down by higher authority Term operational audit Definition review of any part of an orgaization operations (procudes like auditing afe process) Term types of auditors (4) Definition 1. public accountant 2. government auditors 3. cra 4. internal Term (GAAS) stands for Definition Genearally Accepted Auditing Standards Term Genearally Accepted Auditing Standards 3 reponsibilities Definition general examination reporting Term general three important parts part of GAAS Definition technical training PROFICIENCY DUE CARE OBJECTIVE state of mind Term examination (5 total pointS) part of GAAS Definition planning execution supervision understanding on environment and internal control appropriate audit evidnece Term reporting part of GAAS 5 points Definition prepare a standardized repot identifiy the financial statments state reponsiblity of mgmt and auditor explain scope provide opinion Term elements of quality control 9... Definition 1. leadership responsiblities in firm 2. tgeneral ethical requirements 3. independnece 4. client acceptance 5. general human resource policies 6. extent of professional development 7. engagemetn performance 8 engagement quality control 9 documentation Term why have ethics Definition society funcitoning in orderly mannor incorporated into laws to makes ure people aren't behaving unethically Term accountants are unique from other professions: how Definition they are hired by management yet reports to shareholders. Term 6 principals of governing conduct Definition 1. maintaining the good repuattion of the profession 2. perform services with integrity due care sustain professional competatnce 3. be and remain free of influence 4. duty of confidence 5. develop practic based upon professional excellence 6. professional coutesy should be maintained Term three important concepts of independence Definition in fact in appearance threats (challenges) Term independence in fact means Definition no ownership in company no relatives in upper mgmt do not accept gifts Term independence in appearance means Definition unbiansed as appears to others... Term treats to independence 5 things Definition 1. self interest threat 2. self review 3. advocacy 4. familiarity 5. intimidations Term treats to independence self interest example Definition ie the firm is afraid that person will leave Term treats to independence self reveiw example Definition can't do bookeeping and audit serivces Term treats to independence advocasy example Definition accounting firm going to bank to say that the loan should be approved Term treats to independence familiarity threat example Definition ie former partner is not CEo, long time client (ie top 5 list of people to call when you die...) Term treats to intimidation example Definition CLIENT threatening to replace firm Term when no confidentiality is expected? (3) Definition 1. with client permission 2. reqeusted by law 3 professional duty to disclose Term 3 important parts of GAAS Definition 1. technically training and proficiency 2. due care 3. objective state of mind Term components of auditors report (6) Definition ttile address paragraphs (intro scope and opinion) signature city date