What is the difference and relation between Business risk Inherent risk Control risk Detection...
In risk based audit engagements understanding different kinds of risk become extremely important. Proper understand will not only differentiate between different kinds of risks but also help you in recognizing the duties of management...
What is meant by Subject Matter in assurance engagements in auditing?
For an engagement to be an assurance engagement five elements needs to be present which are as follows:
Existence of three party relationship i.e. practitioner, responsible party and the intended users
Subject matter
Criteria
Collecting sufficient appropriate audit...
What is meant by sufficient appropriate audit evidence and how is it obtained?
It is the responsibility of the auditor to obtain reasonable assurance by conducting audit engagement and expressing his opinion in the audit report. This expression of opinion results in reasonable assurance which is conveyed...
What is meant by inherent limitations of audit and what are these?
Inherent limitations are such features of audit that constrains the auditor to obtain absolute assurance. It is because of these inherent limitations of audit the practitioner cannot assure the users of financial statements that...
What is meant by Anomalous misstatement?
Lingual meaning (general meanings in English language) of the word anomaly or anomalous is of something that is irregularĀ i.e. something that is not expected to happen frequently or does not follow a certain expected...
Can auditor agree to change the terms of audit engagement after initial acceptance during...
Normally the change is neither requested nor required by the client in the terms of audit engagement once they have been agreed at the start. The reason is that terms are agreed upon after...
What is meant by Significant Matters in auditing?
Significant matters are such matters that give risk to special audit consideration, treatment, conclusion or opinion.
What is significant matter is not clearly defined in International Standards on Auditing (ISAs) and therefore what amounts to...
How can auditor overcome inherent limitations of an audit engagement?
Auditors or practitioners conduct audit and other assurance engagements under certain limitations which are commonly known as Inherent limitations of an audit (assurance) engagement. It is these limitations that restricts the auditor to gain...
Why auditor cannot provide Absolute level of assurance in audit engagement?
According to International Standards on Auditing ISAs, auditor is required to obtain reasonable assurance whether financial statements give true and fair view or in others words he must be reasonably sure that financial statements...
What is meant by Audit evidence?
Auditors objective or in simple words responsibility with respect to audit engagement is only to the extent of expression his opinion on financial statements whether they have been prepared in accordance with applicable financial...