Auditors’ Responsibilities Regarding Fraud – Do They Have to Report Fraud?

Audit, Fraud

Over the past few years, it can be seen that auditors’ responsibilities towards reporting any possible gaps in the financial statements have increased exponentially. This is primarily because of the major scandals that have greatly impacted the accounting profession as a result of the fraud. Therefore, to maintain integrity and confidence in the profession of […]

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Financial Accounting: Definition, Uses, Characteristics, and Importance

Financial Accounting

Definition: Accounting can be described as the recording, controlling, reporting, and analyzing of an entity’s business transactions that occur every day so that the related stakeholders could use that financial information for their own interest. It is the channel through which parties interested in the business that is both the shareholders and stakeholders share information

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Auditors Responsibilities on Financial Statements (Explained)

Audit, Financial Statements

The process of getting financial statements audited is a really important step in lieu of ensuring that the organization has presented true and fair view of their financial position over the past year. Therefore, the responsibility of an auditor to provide assurance on that particular claim is quite significant, since it really impacts the overall

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Management Responsibilities on Financial Statements (Explained)

Financial Statements

Financial Statements are very important and useful tools when it comes to measuring the overall performance of the company across a given time frame. There are numerous stakeholders which make use of the financial statements, essentially because of the fact that they provide a snapshot regarding the company’s performance in shorter time duration. As a

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Professional Judgment in Auditing – What Is It? (Usages included)

Audit

Usually, in most countries, every company is obliged by law to prepare its annual financial statements as well as get them audited by a statutory auditor. The responsibility of a statutory or independent or external auditor, as per the International Standards of Auditing (ISA), is to obtain all relevant information from the management and those

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What is the Accounting Estimate? (Example and Explanation)

Financial Accounting

Accounting estimates can best be described as the approximation of the amount to be debited or credited in the respective account, where no precise means of measurement are readily available. Accounting estimates are generally derived from specialized knowledge and judgment, which is derived from experience and training. Mostly they are used in determining the carrying

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What Are the 7 Financial Statement Assertions? (Explanation)

ASSERTIONS

Financial Statement Assertions are the claims that are made by the organization’s management pertaining to the financial statements. These assertions form a consolidated basis from which external auditors are able to develop a set of audit procedures. Therefore, it can be seen that when management prepares financial statements, they make five assertions regarding each line

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