Auditing Theory

Running head: Auditing Theory
Auditing Theory
Name of the Student
Name of the University
Author Note

1
Auditing Theory
Table of Contents
Part 1 : Planning.........................................................................................................................2
Overview of the company......................................................................................................2
Answer to A...........................................................................................................................2
Answer to B............................................................................................................................3
Answer to C............................................................................................................................4
Part 2: Internal Control...............................................................................................................6
Bibliography...............................................................................................................................8

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Auditing Theory
Part 1 : Planning
Overview of the company
EML stands for Environmental Monitoring Ltd, which provides services related to the
environmental solutions such as water discharges from earthworks projects, industrial sites
and also remote monitoring of different chemical and fuels tanks of different company.
Answer to A
Services Provided by EML
It provides services into three different forms to its customers, the three forms in
which it provides services are:
1. Built and Supervised Monitoring Systems – It built the system of different
company and also maintain the system till its lifetime, so this help them to provide a
good and better service to the customers
2. Monitoring Services – It also provide monitoring service to different customers that
involve from the instillation of the system to maintaining the system is gives it
services
3. Built Systems – It also built only system to the customers, only the manufacturing
process is been done by the company, so it only make the system for the customers
and all other functions are not been carried by the company.
Key features of the Industry
The main feature of the company is water monitoring so it should check whether the
contract is been based in properly as per the industry norms, no material misstatements
should be there and no related party transactions should be there in the company.
Key features affect the audit

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Auditing Theory
As per Module 3 the audit issue which the auditor face it cannot gather sufficient information
which are required by the auditor, as the company have water monitoring process so it may
happen due to technical work of the company the auditor may not able to gather the required
information and as a result it will affect the audit quality and may the auditor will take wrong
decision regarding the company. The other issue which the auditor will face is as the
company have so much of technical works so the auditor will not able to get details so each
transaction and it will have the issue competent evidence as it will not have to get the proper
evidence of each transaction and as result auditor will not able to take proper judgement
regarding the company financial position. The aspects which should also be see that the
quality control methods which are used by the company to ensure the quality of their product
and the auditor have to check but it can be affect the audit of the company as it will not able
to ensure that the quality test done by the company as there will not able to gather the
sufficient amount of the quality and it will affect the quality of the audit. Unqualified
accounting staff will also have a big impact upon the quality of the audit as if the staff is
unable to maintain a proper record of the business transaction as this also affect the audit
process as if the auditor is unable to get the proper record than it will not able to get proper
details and as a result of it the quality of audit will be hampered and the auditor will not able
to judge the risk in the company.