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StuDocu is not sponsored or endorsed by any college or universityACC 3600 Notes - Summary Auditing and assuranceAuditing and Assurance (Monash University)Downloaded by Bo Bold ([email protected])lOMoARcPSD|3484379
Week 1 Introduction and overview of audit and assurance1.Financial statement AuditAn engagement designed to express an opinion about whether the financial report is prepared in all materialrespects in accordance with a financial reporting framework, accounting standard and Corporation Act. Auditorcannot guarantee that financial report is free from error or fraud. Auditor cannot provide absolute assurance.2.The duties of an independent auditor engaged to perform a financial report auditReport to members and express opinion whether the financial report is prepared in all materialrespects in accordance with a financial reporting framework, accounting standard andCorporation Act;3.The Level of Assurance ServicesReasonable assurance is the highest level of assurance. It means that the auditor has conducted audit proceduresand gathered sufficient and appropriate evidence to provide an opinion on the truth and fairness of the financialreports. The auditor provides an opinion stated in the positive form. Such as financial statement audit.Limited assurance is a lower level of assurance. The auditor performs limited audit procedures and gathers lessevidence. The auditor provides an opinion stated in the negative form. Such as review half year financial report. 1Downloaded by Bo Bold ([email protected])lOMoARcPSD|3484379
4.Audit Expectation GapDefinition: the expectation gap that exists between what users expect of an auditor and the service auditorprovide. The gap is caused by unrealistic user expectationssuch as:the auditor is providing complete assurancean unqualified audit opinion is an indicator of complete accuracythe auditor will definitely find any fraud and the auditor has checked all transactionsThe expectation gap can be reduced by:5.The demand for auditing can be explained by the following three theories:2Downloaded by Bo Bold ([email protected])lOMoARcPSD|3484379
Week 2 Ethics, Legal Liability and Client Acceptance1)Fundamental principles Code of EthicsIntegrity ObjectivityProfessional competence & due careMaintain knowledge and skill at a level required by professional bodies;