Term
| Each state regulates use to title "CPA" through |
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Definition
| state law and licensing department |
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Term
| Accounting is the process of |
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Definition
| recording, classifying and summarizing economic events |
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Term
| An internal auditor is independent of |
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Definition
| the line functions of the org |
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Term
| Written report not required when performing___ |
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Definition
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Term
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Definition
| relevance and reliability of information. information is reported verbally |
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Term
PCAOB _ Public Company Accounting Oversight Board was established on _____
under _______ to provide ______ |
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Definition
| July 30, 2002; Sarbanes Oxley; oversight for auditors of public companies |
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Term
| 3 common types of attestation services |
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Definition
1) Audit of historical financial info
2) Audit of internal control over financial reporting
3) Review of historical financial statements |
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Term
| Primary concern wehn auditing fin accounting data |
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Definition
| whether info properly reflect economic events that occured |
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Term
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Definition
| oral responses, written communicatio, observations |
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Term
| Objective of Operational audit |
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Definition
| make recommendations for improving performance |
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Term
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Definition
| a review of any part of org's operating procedures and methods for purpose of evaluating efficiency and effectiveness |
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Term
| Information Risk (define) is signif reduced if audit performed |
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Definition
| Risk that info upon which business decision made is inaccurate |
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Term
| Financial statement audit is conducted to determine... |
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Definition
| overall financial statements are in accordance with GAAP. Audits are perf in accordance to Gen Accepted Auditing Principles |
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Term
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Definition
| type of assurance service - CPA issues report on reliability of another party's assertion |
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Term
| auditor, in addition to understanding accounting, must possess |
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Definition
| expertise in accumulation and interp of evidence |
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Term
| Audit of Fin statements includes |
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Definition
| Statement of income, cash flows, and financial position |
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Term
| AICPA (Amer Institute of CPAs)Auditing Standard Boards issue statements on Auditing standards, considered... |
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Definition
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Term
| PCAOB has adopted standards issued by AICPA as |
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Definition
| transitional standards for public companies. pcaob has also issued some of their own |
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Term
| PCAOB requires (over ASB) |
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Definition
| audit of internal controls to be integrated w/ audit of fin statements 2 |
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Definition
Gen Standards
1) Must have adequate technical training and proficiency to perform audit.
2) Must maintain independence in mental attitude.
3) Must exercise due professional care in performance of audit and prep of report |
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Term
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Definition
1. must adequately plan work and supervise assistants
2. must obtain sufficient understanding of entity and its environment to assess risk of material misstatement and to design further audit procedures
3) must obtain SUFFICIENT AND APPROPRIATE audit evidence to obtain reasonable basis for an opinion |
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Term
| 4 standards of reporting (2) |
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Definition
1. Must state in report whether fin statements are presented in accord w/ GAAP
2. Must identify circumstances in which principles have not been consistently observed in current period in rel to prior per
3. Must state if any informative disclosures arent reasonably adequate.
4. Must express opinion on fin statements as a whole. if cant express overall opinion, should state reasons why. when auditor's name is associated, should indicate character of work and the degree of responsibilty taken |
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Term
| Cpas must justify departures from (2) |
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Definition
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Term
| AICPA establish that CPA firm that audits publicly held companies must.. |
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Definition
| belong to the SEC practice section |
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Term
| GAAS and SAS are minimum standards |
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Definition
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Term
| The auditor's ______ determines how much evidence to accumulate for a given set of circumstances |
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Definition
| professional judgement (2) |
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Term
| auditor looks to ______ when no specific guidance or standards exist |
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Definition
| Statement on Standards for Attestation Engagements |
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Term
| CPA "quality control" program means |
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Definition
| giving staff continuing professional education to provide knowledge to do work and progress w/in firm |
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Term
| Any CPA may join the AICPA |
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Definition
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Term
| Any CPA may join the AICPA |
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Definition
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Term
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Definition
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Term
| 7 parts standard Unqual Audit report |
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Definition
1. Report Title - "Independent"
2. Audit Report Address - BOD & Shreholders
3. Intro Par - fact
4. Scope Par - fact - "Reasonable Assurance" "Material Misstatement"
5. Opinion Par
6. Name of CPA firm
7. Audit Report Date - date field work completed, last day of responsibility for review of signif events |
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Term
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Definition
1. states CPA firm has done an audit
2. lists statements that were audited, if comparative - must include both years
3. states that statements are responsibility of mgmt and auditor's reponsibility is to state an opinion |
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Term
| 5 Conditions for Standard Unqual Rep |
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Definition
1. All statements included in report
2. 3 Gen standards have been followed
3. Sufficient evidence has been accum (3 field standards met)
4. Fin statements are presented in accordance w/ US GAAP
5. No circumstances exist that req addtn of explanatory par or modified wording |
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Term
| Satisfactory results of audit result in: |
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Definition
1. unqual report
2. unqual report w/ expln par
3. unqual report w/ modified wording |
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Term
| Qualifying paragraph is inserted between ____ and ____ pars for qual OR adverse opinions |
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Definition
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Term
| Qualifies, adverse, disclaimer issued when |
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Definition
| fin statements arent presented fairly OR audit results not satisfactory |
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Term
| Qualified report (EXCEPT FOR) |
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Definition
| Either scope AND opinion (scope limitation) or JUST OPINION (reserved for when statements not fairly stated) |
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Term
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Definition
| AUDITOR KNOWS fin statements not prepared according to GAAP - materially misstated or misleading |
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Term
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Definition
LACK OF KNOWLEDGE to satisfy self that statements fairly presented
1) severe limitation of scope
2) nonindependant relationship
3) maybe for going-concern problem |
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Term
| Scope Par - WHAT AUDITOR DID |
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Definition
1)Indicates auditing standards followed, from what country and auditing standards followd
2) reasonable assurance about lack of material misstatement
3) discusses audit evidence, states that acumm evidence was appropriate for opinion presented
4) "test basis" |
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Term
| Not Independent Disclaimer of Opinion |
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Definition
| We are not indpendent with respect to Co. and accompanying statements, and the related statements were not audited by us. Accordingly, we do not express an opinion on them. |
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Term
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Definition
| 1) intro "we were engaged to audit" and opinion pars "because we" modified, scope par eliminated. |
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Term
| Disclaimers and adverse opinions are used for conditions that are |
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Definition
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Term
| shared opinion report requires modifying___ |
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Definition
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Term
| 4 Circumstances for explanatory paragraph |
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Definition
1. Lack of consistent application of GAAP
2. Substantial doubt about going concern
3. Auditor agrees w/ departure from GAAP
4. Emphasis of a matter |
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