Auditing concepts

Auditing concepts

1. By Gayathiry D

2. Auditing Origin – Definition – Objectives –Scope - Types – Advantages and Limitations – Qualities of an Auditor – Audit Programmes- Basic Principles governing an audit- Ethical principle - concept of Auditor’s Independence- Relationship of auditing with other disciplines.

3. Origin And Definition The word audit is derived from the Latin word “AUDIRE” which means to hear. Initially auditor was a person appointed by the owners to check account whenever the suspected fraud, he was to hear explanation given by the person responsible for financial transactions. Emergence of joint stock companies changed the approach of auditing as ownership was pestered from management. The emphasis now is clearly on the verification of accounting date with a view on the reliability of accounting statement. Auditing refers to a systematic examination of books, accounts, documents and vouchers of an organization to ascertain how far the financial statements present a true and fair view of the concern. ISA (International Standard of Auditing) “ An Audit is the independent examination of financial statement or related information of an entity, whether profit oriented or not, and irrespective of its size, or legal form, when such an examination is conducted with a view to expressing an opinion thereon”

4. Relationship of auditing with other disciplines.