Audit Theory and Practice

This document provides an overview of audit theory and practice. It explains the concept of auditing and its stages, highlighting the role of auditors in verifying financial information. The document also discusses the importance of auditing in assessing the materiality of financial statements.

Running head: AUDITING
Auditing
Name of the Student:
Name of the University:
Author’s Note:

1AUDIT THEORY AND PRACTICE
Table of Contents
Question 1..................................................................................................................................2
Question 2..................................................................................................................................2
Reference....................................................................................................................................4

2AUDIT THEORY AND PRACTICE
Question 1
I would like to introduce myself as Mark Steven a solo practitioner in Auditing and
Assurances services field with my background in Professional Accounting. Audit has been a
broad based concept focusing on systematic and independent verification of the various
accounts of the company in order to determine the materiality of the same. The verification of
the accounting data and information presented by the company is done to assess the
materiality of the information (Krarti 2016). Auditing helps the financial users of the
company asses the viable and correct information about the company so that they can apply
the same for the purpose of investment decision. Auditing is performed in four main stages
where the first step defines the role of Auditor in the process of auditing, the second step is
planning the Audit work, the next important step comes the compilation and collection of the
various and examining it and the final stage would comprise of the preparation of the various
report by the auditor of the company (Christensen et al. 2016).
Question 2
The initial understanding of the auditing after doing the masters of professional
accounting course was that Auditing helps remove the biased when shown by the companies
in preparing the financial statements of the company. Auditing helps in reinstating and
correctly examining of the various classification of the accounting information and data of
the company (Cameran, Prencipe and Trombetta 2016). Audit aims at looking at specific
object or statements or the so called material error in the accounting data presented. Auditing
is done on an individual basis by the Auditor of the company for assessing the viability and
verifying the financial statements of the company. Thus the examination of the various
accounts of the company whether profit making or not and irrespective of the size and nature
of transactions that is done by the company (Goodwin and Wu 2016).

3AUDIT THEORY AND PRACTICE
Reference
Cameran, M., Prencipe, A. and Trombetta, M., 2016. Mandatory audit firm rotation and audit
quality. European accounting review, 25(1), pp.35-58.
Christensen, B.E., Glover, S.M., Omer, T.C. and Shelley, M.K., 2016. Understanding audit
quality: Insights from audit professionals and investors. Contemporary Accounting
Research, 33(4), pp.1648-1684.
Goodwin, J. and Wu, D., 2016. What is the relationship between audit partner busyness and
audit quality?. Contemporary Accounting Research, 33(1), pp.341-377.
Krarti, M., 2016. Energy audit of building systems: an engineering approach. CRC press.