Auditing Chapter 1

the recording, classifying, and summarizing of economic events in a logical manner for the purpose of providing financial information for decision making

an independent professional service that improves the quality of information for decision makers

a type of assurance service in which the CPA firm issues a report about the reliability of an assertion that is the responsibility of another party

a form of attestation service in which the auditor issues a written report stating whether the financial statements are in material conformity with accounting standards

the communication of audit findings to users

the accumulation and evaluation of evidence about information to determine and report on the degree of correspondence between the information and establised criteria

a person who has met state regulatory requirements, including passing the Uniform CPA Examination, and has thus been certified; a CPA may have as his or her primary responsibility the performance of the audit function on published historical financial statement of commercial and noncommercial financial entities

(1) a review of an organization's financial records performed to determine whether the organization is following specific procedures, rules, or regulations set by some higher authority; (2) an audit performed to determine whether an entity that receives financial assistance from the federal government has complied with specific laws and regulations

any information used by the auditor to determine whether the information being audited is stated in accordance with established criteria

an audit conducted to determine whether the overall financial satements of an entity are stated in accordance with specified criteria (usually U.S. or international accounting standards)

an auditor working for the U.S. Government Accountability Office (GAO); the GAO reports to and is responsible solely to Congress

certified public accountants or accounting firms that perform audits of commercial and noncommercial financial entities

the risk that information upon which a business decision is made is inaccurate

auditors employed by a company to audit for the company's board of directors and management

an engagement in which the auditor reports on the effectiveness of internal control over financial reporting; such reports are required for accerlerated filer public companies under Section 404 of the Sarbanes-Oxley Act

auditors who work for the Internal Revenue Service (IRS) and conduct examinations of taxpayers' returns

a review of any part of an organizaation's operating procedures and methods for the purpose of evaluating efficiency and effectiveness

a form of attestation in which a CPA firm issues a written report that provides less assurance than an audit as to whether the financial statements are in material conformity with accounting standards

a federal securities law passed in 2002 that provides for additional regulation of public companies and their auditors; the Act established the Public Company Accounting Oversight Board and also requires auditors to audit the effectiveness of internal control over financial reporting