Audit engagements include various techniques and methods to obtain audit evidence. On top of that, they also help auditors analyze and test the acquired information. However, these techniques may differ based on the type of data obtained or the objective of the test. One of these techniques includes analytical procedures. …

What is Audit Risk? The primary objective of an audit engagement is for the auditors to provide an audit report. This report must state the auditors’ opinion of whether the financial statements are free from material misstatements. However, they always face the risk of providing an incorrect audit opinion. This …

Impairment refers to the loss of value of a fixed asset. In accounting, impairment loss quantifies this loss. Several factors may contribute to a fixed asset losing its value. These factors may be external or internal. Usually, companies conduct an impairment test to determine if a fixed asset has suffered …

Auditors provide an audit opinion in their independent auditor’s report. In most cases, it involves an unqualified opinion, also known as a clean opinion. However, if auditors determine the subject matter has some issues, they may change their opinion. One of these opinions includes the adverse audit opinion. It is …

Audit engagements involve auditors providing their opinion on a subject matter. This audit opinion comes in the form of an audit report. Essentially, it includes the conclusion auditors reach after collecting audit evidence during their work. This conclusion states whether the subject matter is free from material misstatement. However, auditors …

Auditing involves examining the financial statements of a subject matter of a client. Most people associate the process with fieldwork and audit procedures auditors perform. However, there are most steps involved in the process. When auditors start an audit engagement, they plan for it. This process falls under audit planning. …

The auditing process involves assessing a client’s financial statements to form an audit conclusion. There are several stages involved in this process. Primarily, auditors perform the most critical tasks during the fieldwork stage of an audit. However, they must also have a plan to execute during this stage. This plan …

Most people use the terms audit and assurance interchangeably. While they can refer to similar services, they are also not the same. There is a fundamental difference between both. However, some other minor variances between the two also exist. Before discussing those differences, it is crucial to understand what each …

Auditing involves examining an entity’s financial statements. The primary purpose of this process is to ensure the underlying subject matter is free from material misstatements. However, auditors cannot investigate every amount with discrepancies. Usually, they work with time and resource constraints. In these cases, establishing an amount for acceptable levels …

The auditing process involves an auditor examining a company’s financial and accounting systems. These auditors are independent of the underlying company. Similarly, they can be external or internal based on the type of audit. During audits, auditors perform various procedures and gather evidence to support their work. Documenting these procedures …