Английский язык: Сборник текстов. Гурская Т.А. - 23 стр.

    Special bodies of users, such as supervisory boards, employee representatives,
government agencies may sometimes need an in-depth audit report, which is
usually confidential.
    It should be stressed that auditors do not monitor, they offer an opinion, and the
audit process and audit procedures are complicated and manifold. The auditor's opi-
nion is gradually being built up from a mass of detailed work to the final judgement
through the planning and testing stages. The auditor normally starts with a study
of the business environment the audited company is working in and performs a pre-
liminary analytical review.
    Then he should direct his attention to the financial statements. Interestingly enough,
however, the auditor's attention is not directed towards the financial statements' ele-
ments as such. But towards the correctness of various assumptions made by the man-
agement for their preparation. For instance, the auditor needs to know if figures are
complete and accurate and reflect what they should reflect, if income and expenses are
recorded in the proper periods and if the legal position is reflected adequately.
    The auditor should focus on any misstatement whether it is intentional or uninten-
tional. The management is responsible for the reliability of financial position. If the
management is not prepared to take the responsibility it may be hard to complete the
audit. In such situations the auditor should seek his own evidence by means of inde-
pendent audit procedures.
    Although the financial statements are the ultimate objectives of an audit, normally
such audits cannot be completed without a proper study and evaluation of the ac-
counting system and assessment of the internal accounting controls.
    Defining the audit strategy the auditor has to decide whether to rely on internal
controls or to resort to substantive testing applying analytical review procedures, such
as tests in totals, comparison with budgets or even statistical analysis of figures.
    In the planning stage as well as during the performance of audit procedures and,
finally, in forming conclusions, "materiality" and "audit risk" are critical elements
in the auditor's judgement. "Materiality" refers to the magnitude or nature of a miss-
tatement (including an omission) of financial information.
    "Audit risk" (including three different components - inherent risk, control risk, de-
tection risk) is the risk that an auditor may give an appropriate opinion on financial
information that is materially misstated.
    The natural fmalization of the audit process is the auditor's report, reflecting the
auditor's opinion on the financial statements. Unfortunately, audits do not always end
up in an approval of the financial statements. Any deviation from the unqualified opi-
nion should be explained in the auditor's report, including the uncertainty or the disa-
greement that caused the auditor to qualify his opinion.
    In order to protect the public interests and the profession's integrity an individual
must be sufficiently educated and adequately trained before being certified to act as an
auditor.



                                                                                       23