What does independence mean in auditing?
Auditor independence refers to the independence of the external auditor. It is characterised by integrity and requires the auditor to carry out his or her work freely and in an objective manner.
Are walkthroughs required by PCAOB?
Now, per AS2, walkthroughs are required when certifying financial reporting controls under Section 404 of the U.S. Sarbanes-Oxley Act of 2002.
What is meant by continuous audit?
A continuous audit is an internal process that examines accounting practices, risk controls, compliance, information technology systems, and business procedures on an ongoing basis. Continuous audits are usually technology-driven and designed to automate error checking and data verification in real-time.
What is sa230?
Standard on Auditing (SA) 230, “Audit Documentation” should be read in the context of the “Preface to the Standards on Quality Control, Auditing, Review, Other Assurance and Related Services1”, which sets out the authority of SAs and SA 200, “Overall Objectives of the Independent Auditor and the Conduct of an Audit in …
Why do auditors need independence?
Auditor independence is part of the foundation of the auditing profession. An independent, reliable, and ethically sound audit gives a company credibility and allows the public to trust in the accuracy of the results and the integrity of the accounting profession.
How do auditors ensure independence?
Independence requires integrity and an objective approach to the audit process. The concept requires the auditor to carry out his or her work freely and in an objective manner. Independence of the internal auditor means independence from parties whose interests might be harmed by the results of an audit.
What is the purpose of walkthroughs in audit?
Walk-through tests are audits of accounting systems that gauge reliability. These tests look to reveal deficiencies and material weaknesses in a company’s accounting systems. Auditors doing the walk-through will watch the company’s staff and analyzed documents created during the process to identify weak points.
What is the example of continuous audit?
For example, if the average travel reimbursement for employees is $1,500, and 95% of the reimbursements are under $5,000, a continuous auditing program might look for travel reimbursements for more than $5,000.
What is the advantage of continuous audit?
1. The books are verified throughout the year, therefore accounts can be finalized immediately after the end of the financial year and statements of accounts can be presented to the shareholders, immediately thereafter. 2. The books can be extensively checked and mistakes can be rectified then and there.
Which SA is for audit documentation?
SA-230
Scope: This standard deals with auditors responsibilities in preparation of audit documentation while auditing financial statements. Specific documentation requirements of other Standards on auditing do not limit its scope.
Why do auditors document their work?
Objectives of Audit Documentation Audit documentation also facilitates the planning, performance, and supervision of the engagement, and is the basis for the review of the quality of the work because it provides the reviewer with written documentation of the evidence supporting the auditor’s significant conclusions.