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 …

Internal controls refer to the rules and procedures within a company to ensure the integrity of financial and accounting information. These controls are essential to running a company. Similarly, they help with business continuity and ensure the accuracy of the financial reporting process. Internal controls are also a vital part …

Auditors examine a company’s financial statements to provide an opinion. However, they must support this opinion through audit evidence. Auditors must collect this evidence to draw reasonable conclusions regarding the fairness and truthfulness of the financial statements. Usually, auditors use various methods or techniques to gather audit evidence. These primarily …

The term auditing is synonymous with the external audit process. In this process, independent auditors examine a company’s financial statements and provide their opinion. However, other areas within auditing exist, which can also be crucial for companies. One of these includes compliance audits. These audits can be critical in avoiding …

Companies and business report their performance for a period using financial statements. When preparing these statements, their management makes several claims. During the audit process, auditors must verify those claims. Based on this verification, they must reach a conclusion in the form of an audit opinion. This process relates to …

For most companies, external audits are mandatory. This process involves independent auditors assessing a company’s financial statements. Based on that, they conclude whether those statements include material misstatements. However, companies must also examine their internal processes. This process falls under internal auditing. Within that process, companies may conduct operational audits. …

There are many types of audits that companies may go through. The most common of these include an external or statutory audit required by laws and regulations. Being a taxpayer, companies may also fall under tax audits. These audits also apply to individuals or any entity that may be considered …

During audits, auditors can use various techniques or methods to obtain audit evidence. These methods come into two categories, including the test of controls and substantive procedures. Substantive procedures have two types, consisting of analytical procedures and the test of details. Within this process, auditors can use several techniques. Two …