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AUDITING Lecture 3

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Principles of Auditing.

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									AUDITING
 By Atiq ur Rahman
      For MBA
    IM|Sciences
       OBJECTS of an AUDIT

Detection and Prevention of    Detection and Prevention of
   Errors and Mistakes        Frauds and Misrepresentations




Expression of Independent
         Opinion
                                     Moral Check
       OBJECTS of an AUDIT

Detection and Prevention of    Detection and Prevention of
   Errors and Mistakes        Frauds and Misrepresentations




Expression of Independent
         Opinion
                                     Moral Check
OBJECTS of an AUDIT

 Compensatory Errors
  Trial ofof Omission
  Errors Commission
 ErrorsBalance Errors

Clerical Errors
   Error in taking out balances
     Such counter-balanced
      Transaction is not balance etc
      Errors in Additions effect
   Errorsis Errors dowholly or by
Casting error, omission of and
    Errors of incorrect postings
            Trial Balance
            another error
       From ledger accounts
          Carry Forwards
          partially omitted
  OBJECTS of an AUDIT

  Errors of Principle

                 Outstanding
    Omission of allocation
       Incorrect
 Incorrect valuation of assets
             and Liabilities
      Assetscurrent assets or
  (incorrect
(incorrect distinction between
(e.g. prepayments are ignored or
  Fixed expenses are ignored)
          assets valuation)
Capital and Revenue Items)
 accrued
       OBJECTS of an AUDIT

Detection and Prevention of    Detection and Prevention of
   Errors and Mistakes        Frauds and Misrepresentations




Expression of Independent
         Opinion
                                     Moral Check
       OBJECTS of an AUDIT

Detection and Prevention of    Detection and Prevention of
      Depends upon requirements
   Errors and Mistakes        Frauds and Misrepresentations
   of client except limited companies



Expression of Independent
         Opinion
                                     Moral Check
       OBJECTS of an AUDIT

Detection and Prevention of    Detection and Prevention of
  Visits of Auditor have considerable
   Errors and Mistakes        Frauds and Misrepresentations
    Moral checks on staff of clients



Expression of Independent
         Opinion
                                     Moral Check

								
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