AUDITING

A PRACTICAL APPROACH
EXTENDED CANADIAN EDITION
MORONEY, CAMPBELL, HAMILTON, WARREN

Prepared by:
Angela Davis CPA, CA, CFE, MSc
Booth University College

CHAPTER 1
INTRODUCTION AND OVERVIEW OF AUDIT AND
ASSURANCE

LEARNING OBJECTIVE 8:

Describe the audit expectation

gap

Copyright John Wiley & Sons Canada, Ltd.

Audit Expectation Gap

Is the difference between the expectations of
assurance providers and financial statements or
other users.
Can be caused by unrealistic expectations including :

The auditor providing a complete assurance.

The auditor guaranteeing future viability of entity.
An unqualified opinion denotes complete accuracy.
The auditor will find all frauds.

We know these cannot be met by the auditor as the

auditor provides reasonable assurance not a
guarantee.

Copyright John Wiley & Sons Canada, Ltd.

Audit Expectation Gap

The expectation gap can be reduced by:
Auditors performing their duties appropriately,
complying with standards and meeting the
minimum standards of performance
Undertaking peer reviews of work performed
Reviewing and updating auditing standards.
Educating the public.
Enhanced reporting explaining audit processes
and levels of opinion auditors provide to the
entity.
Providers reporting accurately the level of
assurance being provided
Copyright John Wiley & Sons Canada, Ltd.

Copyright
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