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the purpose and usefulness of standard audit report - Essay Example
Author : julescrona
Finance & Accounting
Pages 8 (2008 words)
Name: Tutor: Course: Date: University: The purpose and usefulness of standard audit report Introduction An audit report refers to the formal opinion or disclaimer, issued either by an independent external auditor or an internal auditor as a result of external or internal evaluation or audit performed, on legal entities or subdivision thereof…
Normally, audit reports presents the external review of the financial information of a company, conducted by an accounting firm and shareholders use it in assessing the financial health of a company. The Financial Reporting Council (FRC) in UK recommended for the enhancement of the responsibilities in financial reporting for the audit committees through publicizing of expanded reports. The auditor reporting entails coordinated structure that leverages the resources by IAASB (Boeckman et al. 2013, p. 76). A standard report summarizes an audit by the public accounting firm about the liquidity strength of a company. Auditing process entails comparison of the findings to internal audits to identify any discrepancies or errors involved therewith. When the audit is clean, standard audit report results. The standard audit report is the most used audit report, and it ensures that companies do not defraud the investors. Failure of the audit reports to conform to the acceptable standards in accounting creates apprehension amongst the shareholders of the company (Boeckman et al. 2013, p. 77). The corporate finance statements and other investors express the concerns on the usefulness of standard audit reports (SAR). ...