Accounting includes the collection classification summarization and

Accounting includes the collection classification

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Accounting includes the collection, classification, summarization, and communication of financial data. The task of accounting is to reduce a tremendous mass of detailed information to manageable and understandable proportions. Auditing does none of these things Its task is to review the measurements and communications of accounting for propriety (i.e. proof/ support) Thus, auditing has it principle roots, not in accounting, which it reviews, but in logic on which it leans heavily for ideas and methods
External vs. Internal Assurance Svs. Internal Auditing: Assurance and Consulting Services, 2 nd Edition. © 2009 by The Institute of Internal Auditors Research Foundation, 247 Maitland Avenue, Altamonte Springs, FL 32701 USA 29 The independent (CPA), external, outside audit firm provide their financial reporting assurance services primarily for the benefit of third-party decision makers , and, accordingly, increase the users’ confidence regarding the accuracy, completeness, and validity of the information upon which they base their decisions Internal auditors provide their financial reporting assurance services primarily for the benefit of the BOD and management Management relies on the financial reporting assurance services provided by the company’s internal audit function to provide them with confidence (i.e. reasonable assurance) regarding the truthfulness of their financial reporting assertions
Exhibit 1-3 Internal Auditing: Assurance and Consulting Services, 2 nd Edition. © 2009 by The Institute of Internal Auditors Research Foundation, 247 Maitland Avenue, Altamonte Springs, FL 32701 USA 30 A Dynamic Profession The history of IA has been traced to centuries B.C. Modern IA is associated with the establishment of The IIA in 1941. Both The IIA and the IA profession have evolved dramatically Internal auditing is now truly a global profession
Modern Internal Auditing Internal Auditing: Assurance and Consulting Services, 2 nd Edition. © 2009 by The Institute of Internal Auditors Research Foundation, 247 Maitland Avenue, Altamonte Springs, FL 32701 USA 31 A Dynamic Profession A number of interrelated circumstances and events have fueled the dramatic increase for internal audit services over the past 30 years. The business world has changed: globalization, increasingly complex corporate structures, e-commerce and other technological advances, and a global economic downturn. Simultaneously, the business world has experienced a rash of devastating corporate scandals, which have precipitated a groundswell of new laws and regulations and professional guidance.
Modern Internal Auditing Internal Auditing: Assurance and Consulting Services, 2 nd Edition. © 2009 by The Institute of Internal Auditors Research Foundation, 247 Maitland Avenue, Altamonte Springs, FL 32701 USA 32 Nature and Scope Internal audit helps the organization achieve its business objectives by evaluating and improving the effectiveness of governance, risk management, and control processes Within each of the areas there are opportunities for improving the business operations, reporting and compliance As such,

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