IMPORTANCE IN AUDITING
S . SADAN FIROZ
FACULTY NO. 16CMB019
ENROLL NO. GH – 9786
UNDER SUPERVISION OF
DR. ASHRAF ALI
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AUDITORS REPORT
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- Audit report is used by many
stakeholder including entity’s
management, board of director,
shareholders, investors, government
body, banks, and many others.
- In most case, audit report is issued to
cover financial statements over 12
months or one year period.
- Investors use audit report and
audited financial statements to assess
entity’s financial performance,
and financial position for their
investment opportunity.
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integrity of managements and
transparency of financial statements.
NOTED
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FOUR TYPES OF AUDIT REPORTS:
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#1 UNQUALIFIED AUDIT REPORT
(CLEAN AUDIT REPORT):
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- Unqualified Audit report not only
apparently shown to the shareholders
that financial statements are true and
fair presentation, and free from all
material misstatements.
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#2 QUALIFIED AUDIT REPORT:
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- The misstatements found here are
different from the material
misstatements found qualified audit
report.
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they were audited and the period the
financial statements covered.
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#4 Disclaimer Audit Report:
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accounts that material misstated but
not pervasive.
ADVANTAGES/IMPORTANCE OF
AUDIT REPORTS:
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independence from management, the
report could prove whether
managements are honest to their
shareholders or not. This is related to
principle and agency theory.
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enough time to perform their testing as they
should be.
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Auditors Qualification and Competency.
This is also the importance point. We all
know that in order to run audit firm,
someone who represent the firm need to
hold CPA qualification. But the thing is
because the competition, and because of
the amount of works, the quality of audit
report might have some problems. As you
may know
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CONCLUSION:
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- Auditor will issued the adverse opinion
when the financial statement contain
pervasive misstatement. Yet, they will
disclaim not to express their opinion if
they could not have enough to review
financial statements.
THANKING
YOU...
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