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Financial Statements Rely
All Financial providers people must be sure that the financial statements can be relied upon.It should be noted that:1. The auditor himself must be independent to have credibility.
2. He must have the primary objective of producing a report of his opinion on the truth and fairness of the accounts, so that any person reading and using them can believe in them.
3. Subsidiary objectives can be seen to be the detection of errors and fraud, the prevention of errors and fraud by the deterrent and moral effect of the audit and the ability to provide other benefits to his clients such as: • Assistance with accounting; • Systems; • Taxation; • Financial and other problems.The Companies Act was designed to protect shareholders from directors hence the need for an audit as contained in the Companies Act mainly relates to limited liability companies, but as we shall see any organization can benefit from an audit.
Method of corrercting evidence?
the availability of audit evidence is necessary but not sufficient condition for absolute reliance on the figure presented for audit
B. The following situations involve a possible violation of the MIA ByLaws (on professional ethics, conduct and practice). For each situation, (1) decide whether or not the Code ha
list of assets
what is internal audit standardizes.
Completeness of Liabilities In distortion, the directors tend to involve non-existent assets or keep out liabilities. Hence whereas along with assets we are especially concern
Existence - Plant and Machinery However this should generally be checked through physical inspection, so a problem arises. Items of machinery and plant can be numerous mobile
Fortex Limited, the meat processing firm, was formed in 1985 from three smaller companies. In 1993, however, after a few years of spectacular growth, the company collapsed. a)
Amounts Derived From Financial Statements Please note here the auditor is interested in preceding year's evidence since 1. The Companies Act states such corresponding amounts
Action if Management Refuses to Provide Representations If management refuses to provide a representation that the auditor considers essential, this constitutes a scope restric
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