Auditing process - Case Study Example

Only on StudentShare

Extract of sample
Auditing process

This type of risk is known as engagement risk. The probabilities of different loss or damages that can be caused due to this type of risk can be a financial loss, loss of reputation, and ultimately leading to the downfall of the audit farm. Engagement risks can further be subdivided into three types of risks, namely 1) Client’s business risks, 2) Auditor’s business risk and 3) Audit risk. In the cited case of Aerospace Lighting Inc. (ALI) there are several audit issues related to engagement risks. All those audit issues involved with ALI and its impact on the financial statements and the audit process have been discussed here. ALI is a Chicago based company which is involved in the business of providing cabin lighting system to its clients in aerospace industry. There has been a change in ALI’s business strategy and its external auditors. This study entails about the different business risks associated with ALI and the corresponding audit issues. Client Business Risks Business risk can be defined as the probability that a given company will make less profit than what has been anticipated or there is a possibility that the company will make a loss instead of profit. Several factors influence business risks, like cost of inputs, volume of sales, price per unit, government policies and so on and so forth. ...
Download paper

Summary

AUDITING Table of Contents Table of Contents 2 Introduction 3 Client Business Risks 3 Auditor’s Business Risk 6 Audit Risks 7 1.Inherent Risk: 8 2.Control Risk: 9 References 11 Introduction Various important and critical relationships are created through audit process which involves many parties…
Author : runolfsdottirne

Related Essays

Finance and Accounting Research Paper: Continuous Auditing
15 pages (3765 words) Research Paper
Issue in contemporary auditing
12 pages (3012 words) Essay
Auditing Process and Procedures for Smackey's Dog Food Inc.
3 pages (753 words) Term Paper
Statements on Auditing Standadards : Related Parties
4 pages (1004 words) Essay
Internal auditing, Investor accounting, The process of Remittance, Reconciliation and Reporting
3 pages (753 words) Assignment
Does the rotation of auditors improve the quality of auditing?
8 pages (2008 words) Essay
auditing
6 pages (1506 words) Essay
Justification for an Internal Control System
3 pages (753 words) Essay
Analysis of Jet Blue Airline company's Balance sheet
2 pages (502 words) Research Paper
Got a tricky question? Receive an answer from students like you! Try us!