Principles Of Auditing Pdf

  1. Principles Of Auditing 16th Edition
  2. Principles Of Internal Auditing Pdf
  3. Principles Of Auditing Whittington

by Craig Cochran

Subject: Image Created Date: 4/8/2019 3:05:23 PM. The book describes the modern tools and latest techniques practiced by auditors in the real world. It Auditing Principles and Practices lays special focus to incorporate recent changes and new implementations in the field of auditing, such as introduction of The Companies Act 2013, compulsory application of Auditing and Assurance Standards and their convergence with international standards. The Audit Process provides an essential introduction to the principles and practices of auditing. This accessible textbook guides students through every step of the audit process and provides plenty of opportunities to practise what they are learning. PDF Download The Audit Process Principles. Define auditing, the need for and the nature of auditing 2. Describe the legal, regulatory and ethical environment within which audits are performed in Uganda 3. Describe the basic principles and procedures of auditing 4. Explain how audit work is documented to.

Principles are an excellent way to begin our exploration of auditing. After all, these are the ideas that form the foundation of any successful audit program. Many of these principles will seem like common sense, but I’ve come to understand that common sense is indeed not very common. Even smart and experienced auditors sometimes forget these principles. That’s why we have to build the audit program around these ideas and then continually reinforce them. Let’s examine each one and discuss what it means.

Focus on processes, not people

A great deal of evidence gathered during the audit comes from people. That’s because organizations are made up of people. They’re analyzing information, making decisions, and producing products. Despite being a primary source of evidence, people aren’t really the focus of the audit. We’re focusing on the processes, methods, and procedures that are in place. People are the conduit through which we learn about the process.

When there are audit nonconformities (and trust me, there will usually be nonconformities), we make changes to our processes, not our people. A focus on people leads to corrective actions such as verbal reprimands, written warnings, and dismissals. These corrective actions don’t actually change the way work is being done. We might have changed the people, but the same flawed methods will be in place. Effective audits focus on the process and the resulting corrective actions are aimed at improving the process. The only way to make improvements is by changing the way work is being done.

Don’t strive to find nonconformities

This principle may sound strange, given the way some authors conduct themselves. Auditors should try to find evidence that the organization is meeting its requirements. In pursuit of this, it’s inevitable that nonconformities are going to come up. Nonconformities or not, the auditor’s attitude is one of someone carrying out an improvement activity in partnership with the auditee. It’s not a “gotcha” exercise. A good auditor examines a reasonable sample of evidence and draws conclusions from it. No need to keep digging and digging until nonconformities are found. As far as I know, no auditor has ever been paid by the number of nonconformities found.

Some of the most profound outcomes of an audit are the best practices that are revealed, especially in a mature management system. Effective audits identify isolated pockets of excellence that are unknown to the wider organization. In this way the audit becomes almost a benchmarking exercise, with parts of the organization learning from other parts. Effective auditors begin each audit in a “learning” state of mind. They expect to find best practices and positives they will learn from. This learning state of mind makes auditors especially receptive to the good things the organization is doing.

Auditors are naturally curious and persistent, so it’s hard to suppress the satisfaction you might feel when you uncover a nonconformity. There is a visceral thrill that auditors feels when they identify problems that can affect the success of the organization. Nevertheless, effective auditors always conducts themselves in a professional manner. No cheering, high-fives, or shouts of ecstasy when you find a nonconformity, please.

Keep yourself unbiased and impartial

In a word, effective auditors are fair. They simply examine evidence and draw factual conclusions. This can be especially challenging for internal auditors because you know most of the people you’re auditing. You know people who are smart, silly, careless, and downright reckless. In fact, there are probably people you like and people who (gasp) you don’t. Effective auditors have to lock away all these opinions during the audit and approach the audit with fresh eyes and open minds. In spite of your certainty that the guys in the warehouse are a bunch of idiots, you still treat them in the same way you do everybody else. You don’t dig deeper and try harder to find nonconformities. When auditors have especially strong feelings about certain functions, either good or bad, they realize that there is no way they can be unbiased. In these cases, auditors work with the lead auditor to find someone else who can audit the function impartially. Fairness is the consistent thread that runs through every effective audit.

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Independence is another aspect of being impartial. This refers to being organizationally separate from the function that you audit. You certainly don’t audit your own work and you avoid auditing your department. It’s best not to audit any area where you have an existing reporting relationship. No matter how hard you try to be unbiased, you’re tied to the function and you’re likely to be influenced by the relationship.

Maintain confidentiality

The results of the audit do not belong to you. They belong to the entity requesting the audit, known as the “audit client.” This is usually top management. The audit results go to top management, and they are also shared (at least verbally) with the auditee, but that is as far as they go. The audit client gets to decide who else will hear the audit results. It’s your responsibility as an auditor to maintain confidentiality over the results. Audit “war stories” make interesting conversation, but they should never stray into the territory of talking about an organization’s specific strengths and weaknesses. Maintaining confidentiality is a professional courtesy, of course, but it’s also a matter of self-preservation. Auditors who betray confidentiality are not invited back in the future.

Base the audit on requirements and evidence

At the heart of auditing lie two things:

  1. An understanding of relevant requirements
  2. A search for evidence that meets requirements

The factual approach of requirements and evidence keeps the audit purely objective. The auditors’ opinions of what should be done have no relevance. What matters is what the organization has committed to, and whether it’s meeting those commitments. Auditors certainly have opinions and most have valuable experience in the industries they audit. But an audit isn’t a consulting visit, it’s a friendly evaluation aimed at driving improvements. When audits stray from a strict focus on requirements and evidence, they become fuzzy and subjective—exactly what you don’t want.

Be professional

Effective auditors are consummate professionals. This doesn’t mean they’re stiff unblinking robots who refuse to crack a smile. It simply means they are good communicators, well-prepared, smartly attired, and, of course, cordial. When people are going through the trouble of being audited, they want to know their auditor is a pro. This provides credibility to the audit process and lets the participants know it won’t be a waste of time. Professionalism doesn’t necessarily depend on years of experience, either. I’ve seen novice auditors who were exceptionally professional and veteran auditors who were less professional than a circus clown. It all goes back to preparation. If you do the correct amount of preparation for the audit, and arrive ready to produce excellent results, you will be truly professional.

Beyond basic principles

Principles Of Auditing 16th Edition

Principles

It’s helpful for auditors to think about the audit as a series a friendly conversations. That’s really what audits are. Auditors chat with employees about their methods, tools, materials, and products. The information revealed during the conversation is compared to the organization’s requirements and the auditor determines whether the commitments are being met. In either case, the determination isn’t a secret. If we’re meeting requirements, or even going above and beyond requirements, the auditors will congratulate the employees. If the commitments are not being met, the auditors confirm their understanding of the requirements and also confirm their understanding of the evidence. Auditors don’t assume anything. Good auditors verify everything they see and hear because it’s very easy to misinterpret information during an audit. The whole process of gathering evidence and determining conformity is conducted like a conversation among partners. As auditors, that’s exactly what you are: partners in the organization’s improvement processes.

Principles Of Internal Auditing Pdf

Another important point is that top management has to be involved in the audit process. They will certainly be audited and may even act as auditors themselves. Having top management visibly involved in auditing gives the process credibility. This credibility is like a passport to all corners of the organization. When auditors are supported by top management, auditees will cooperate and provide auditors with whatever they need.

Following these principles will enable you to get top management support and maintain the attention of the entire organization. After all, you’re there to help the organization. Yes, I know the old joke, “We’re auditors and we’re here to help you.” When you audit a management system, it’s actually true. Believe it, and carry the rest of these principles with you wherever you audit.

About the author

Craig Cochran is a project manager with the Georgia Institute of Technology Economic Development Institute. He has served in management roles in multiple industries-including textiles, glass manufacture, semiconductor, and telecommunications-for nearly twenty years. Some of his specific areas of expertise include customer feedback methods, auditing, development of key measures, organizational development, management systems of all types, and problem solving.

Cochran is a Certified Quality Manager, Certified Quality Engineer, and Certified Quality Auditor through the American Society for Quality, and is certified as a QMS Lead Auditor through Exemplar Global.

This article originally appeared in the November-December 2014 issue of The Auditor newsletter. Subscribe to The Auditor and get access to articles like this delivered to your desk. Subscribe here.

Principles Of Auditing & Other Assurance Services 21st Edition Pdf is a market leader in the auditing discipline. The book presents concepts clearly and proactively monitor changes in auditing making the relationship between accounting and auditing understandable.

About Principles Of Auditing Whittington 21st Edition

The principles Of Auditing & Other Assurance Services 21st Edition PDF provides a carefully balanced presentation of auditing theory and practice. Written in a clear and understandable manner, it is particularly appropriate for students who have had limited or no audit experience. The approach is to integrate auditing material with that of previous accounting financial, managerial, and systems courses.

The text’s first nine chapters emphasize the philosophy and environment of the auditing profession, with special attention paid to the nature and economic purpose of auditing, auditing standards, professional conduct, legal liability, audit evidence, audit planning, consideration of internal control, and audit sampling. Chapters 10 through 16 (the “procedural chapters”) deal with internal control and obtaining evidence about the various financial statement accounts, emphasizing a risk-based approach to selecting appropriate auditing procedures. Chapter 17 presents the auditors’ reporting responsibilities when performing financial statement audits. Chapter 18 provides detailed guidance on integrated audits of public companies performed in accordance with the Sarbanes-Oxley Act of 2002 and SEC requirements. Chapters 19 and 20 present the auditors’ reporting responsibilities and other attestation and accounting services, such as reviews and compilations of financial statements and reports on prospective financial statements. Chapter 21 presents coverage of internal compliance and operational auditing.


The text is well suited for an introductory one-semester or one-quarter auditing course. Alternatively, it is appropriate for a two-course auditing sequence that covers the material in greater detail. For example, an introductory course might emphasize Chapters 1 through 10, 16, and 17. A second course may include coverage of the other procedure chapters (Chapters 11 through 15); integrated audits (Chapter 18); other attestation and accounting services; and internal, operational, and compliance auditing (Chapters 19, 20, and 21). The instructor might also wish to consider covering portions of Chapter 9 on sampling in the second course, with or without ACL software. Overall, the text and supporting materials provide:

  1. A balanced presentation. The text provides a carefully balanced presentation of auditing and assurance theory and practice. The concepts are written in a clear, concise, and understandable manner. Real company examples are integrated throughout the text to bring this material to life. Finally, Keystone Computers & Networks, Inc., the text’s illustrative audit case, is integrated into selected chapters, providing students
    with hands-on audit experience.
  2. Organization around balance sheet accounts emphasized in previous accounting courses. Organizing the text around balance sheet accounts is a particularly straightforward and user-friendly way to address the risk assessment–based approach to auditing required by both U.S. and international auditing standards. These standards require an in-depth understanding of the audited company and its environment, a rigorous
    assessment of the risks of where and how the financial statements could be materially misstated, and an improved linkage between the auditors’ assessed risks and the particulars of audit procedures performed in response to those risks. Chapters 5 through
    7 of the text describes the risk assessment approach in detail. Chapters 10 through 16 are aligned with the risk assessment approach presented in the professional standards. Accordingly, the suggested audit approach and procedures of the professional standards flow smoothly from the approach suggested in earlier chapters of the text. In short, our organization of the book facilitates student learning of the risk assessment
    process in a very straightforward manner. Also, although the text chapters are structured around balance sheet accounts, they include a significant amount of material on transaction cycles. For example, Chapters 10 through 13 include detailed coverage of revenue, cash receipts, acquisitions, and disbursement cycles.
  3. CPA examination support. Both the text’s emphasis on current auditing standards and its many objective questions (both multiple-choice and another objective format) are aimed at helping students pass the CPA exam. As discussed in detail in the following section, this edition has significantly expanded the number of task-based simulations like the ones included on the CPA exam.
  4. Strong student and instructor support. Both McGraw-Hill Connect® Accounting and the Online Learning Center provide instructors and students with a wealth of material to help keep students up-to-date. The Center also contains quizzes and other resources to help students in this course. The address of the Center (and the text website) iswww.mhhe.com/whittington20e. We are confident that the 20th edition of Principles of Auditing & Other Assurance Services will provide students with a clear perspective of today’s auditing environment


The text is well suited for an introductory one-semester or one-quarter auditing course. Alternatively, it is appropriate for a two-course auditing sequence that covers the material in greater detail. For example, an introductory course might emphasize Chapters 1 through 10, 16, and 17. A second course may include coverage of the other procedure chapters (Chapters 11 through 15); integrated audits (Chapter 18); other attestation and accounting services; and internal, operational, and compliance auditing (Chapters 19, 20, and 21). The instructor might also wish to consider covering portions of Chapter 9 on sampling in the second course, with or without ACL software. Overall, the text and supporting materials provide:A balanced presentation. The text provides a carefully balanced presentation of auditing and assurance theory and practice. The concepts are written in a clear, concise, and understandable manner. Real company examples are integrated throughout the text to bring this material to life. Finally, Keystone Computers & Networks, Inc., the text’s illustrative audit case, is integrated into selected chapters, providing students
with hands-on audit experience.

Organization around balance sheet accounts emphasized in previous accounting courses. Organizing the text around balance sheet accounts is a particularly straightforward and user-friendly way to address the risk assessment–based approach to auditing required by both U.S. and international auditing standards. These standards require an in-depth understanding of the audited company and its environment, a rigorous assessment of the risks of where and how the financial statements could be materially misstated, and an improved linkage between the auditors’ assessed risks and the particulars of audit procedures performed in response to those risks. Chapters 5 through 7 of the text describes the risk assessment approach in detail. Chapters 10 through 16 are aligned with the risk assessment approach presented in the professional standards. Accordingly, the suggested audit approach and procedures of the professional standards flow smoothly from the approach suggested in earlier chapters of the text. In short, our organization of the book facilitates student learning of the risk assessment process in a very straightforward manner. Also, although the text chapters are structured around balance sheet accounts, they include a significant amount of material on transaction cycles. For example, Chapters 10 through 13 include detailed coverage of
revenue, cash receipts, acquisitions, and disbursement cycles.
Preface
Preface v

Table of Content of Principles Of Auditing & Other Assurance Services Pdf

Principles Of Auditing Whittington

The Role of the Public Accountant in the American Economy
Professional Standards
Professional Ethics
Legal Liability of CPAs
Audit Evidence and Documentation
Audit Planning, Understanding the Client, Assessing Risks, and Responding
Internal Control
Consideration of Internal Control in an Information Technology Environment
Audit Sampling
Cash and Financial Investments
Accounts Receivable, Notes Receivable, and Revenue
Inventories and Cost of Goods Sold
Property, Plant, and Equipment: Depreciation and Depletion
Accounts Payable and Other Liabilities
Debt and Equity Capital
Auditing Operations and Completing the Audit
Auditors’ Reports
Integrated Audits of Public Companies
Additional Assurance Services: Historical Financial Information
Additional Assurance Services: Other Information
Internal, Operational, and Compliance Auditing