principle of auditing

Topics: Auditing, Audit, Financial audit Pages: 11 (3509 words) Published: October 28, 2013
TABLE OF CONTENT
NO.
DESCRIPTION
PAGE NUMBER
1
PLAGIARISM STATEMENT DECLARATION FORM
2
2
MARKING SCHEMES

3
PLAGIARISM REPORT FROM SAFE ASSIGN

4
INTRODUCTION

5
ANSWER:
TOPIC 1- NATURE, PURPOSE AND SCOPE OF AUDIT

6
ANSWER:
TOPIC 2 - DISTINCTION BETWEEN ACCOUNTING AND AUDITING

7
ANSWER:
TOPIC 3 - TYPES OF AUDITS AND AUDITORS

8
ANSWER:
TOPIC 4 - MEANING OF TRUE AND FAIR VIEW

9
ANSWER:
TOPIC 5 - DESCRIBE THE PROFESSIONAL ETHICS THAT ARE RELEVANT TO AUDITORS

10
CONCLUSION

11
APPENDIX

12
REFERENCES

INTRODUCTION
After done this assignment, we can understand deeper on the job of auditing. First of all, the knowledge that we receive in the first topic is we can generally know that audit will have their objective of provide creditability for the financial statement prepare by company director to the shareholders. Secondly, this research guides us on the different between accounting and auditing. In this topic, we actually learn that accounting is more on preparing financial statement according to accounting standard. The third topic will be give us learn on every single type of audit such as differences and definition of financial statement audit, operational audit, forensic audit and compliance audit. Furthermore, we learn “true and fair view” in the fourth topic through separate define the word of “True” and “Fair”. Lastly, we will discuss the several threats that affect the value of ethics in today environment and also learn that how importance of ethics in auditing and also the ways to measure whether the audit is done in ethically. Topic 1: Nature, purpose and scope of audit

(i) Nature
Auditing is defined as a systematic and independent examination of data, statements, records, operations and performances of an enterprise for a stated purpose. The auditor perceives and recognizes the propositions before him for examination, collects evidence, evaluates the same and on this basis formulates his judgment which is communicated through his audit report. In addition, it is also legal requirement to examine the organization's financial statements and records by an independent auditor. Statutory audits become mandatory for companies in 1900. At this time the purpose of an audit was to detect fraud, technical errors and errors of principle. (ii) Scope and Purpose

In general, the scope of audit is covering all the statements such as financial statement, statement of cash flow and so on. The objective of audit is to enable the auditor to express an opinion whether the financial statements are prepared according financial reporting framework in a true and fair view and ensure financial statement drawn accurately. In addition, audit can help to enhance confidence of intended users in the financial statements which prepared by the company director. To make sure the financial statement prepare by the director did not have containing any misstatement. Next, different user has different purpose of using audit, for example, the purpose of shareholder need to see the audit report because they need to know the company got earn any profit or not, or the director got do any secret profit or not. Besides that, the purpose of public need to see the audit report because it needs to know the information provide by the company can be trustable or not. They can invest money to the company or not. Topic 2: Distinction between accounting and auditing

(i) Different between Accounting and Auditing
Accounting
Accounting is more focus on recording and analyzing all the business transaction that already made by the company into relevant account and then summarizing all the account into particular report or statement in order to provide a set of statistic information for support certain user in making financial decision, the example of statistic information like net profit, operating expenses and so on. Accounting usually need a set of rules and regulation in prepare account for the company...

References: Books:
Messier, Glover, Prawitt Margaret Boh. (2007). Auditing and Assurance Services in Malaysia. Third Edition. McGraw-Hill (Malaysia) Sdn. Bhd.
Internet:
i. Hubpages, 2010. Nature, Purpose And Scope Of Audit And Review. [online] Available at: [Accessed 4 June 2009 ]
ii. Educomp, 2010. Summary Notes of Chapter 1 – Nature of Auditing. [Pdf file] Available at: [Accessed 4 June 2012 ]
iii. Ventureline, 2010. True and fair definition. [Online] Available at: [Accessed 4 June 2012 ]
iv. Blurtit, 2010. Define Auditing What Is Difference Between Auditing And Accounting? [Online] Available at: < http://www.blurtit.com/q277000.html> [Accessed 4 June 2012 ]
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