Conclusion In conclusion, I want to again commend those of you who plan to enter the accounting and auditing profession for choosing such an intellectually rigorous and dynamic field. Sarbanes during the consideration and passage of that legislation. The very first words of the Sarbanes-Oxley Act of are, "An Act to protect investors by improving the accuracy and reliability of corporate disclosures.
I remain concerned that this perspective is still not ingrained in the DNA of the profession. Other Issues Finally, I want to speak of a few other issues the Board is considering, which I support.
This is not to say that management is not maintaining sufficient documentation for their purposes, but the documentation may not support the testing that the engagement teams are required to perform. Ineffective operations add to overhead without increasing profit. So again, just like planning a trip, thoughtful, planned work is a key step in any audit to help protect the integrity of financial reporting and the capital markets.
Between April and July the stock market dropped more than 22 percent — or some 2, points. We have, however, observed some engagements teams that do not. Management review controls serve as a form of detective control — meaning it is intended to help management identify errors, inaccuracies, or fraud.
The Board recognizes that its efforts to address standard setting must be balanced. We have seen this sort of ineffective testing by some engagement teams that placed significant reliance on certain management review controls.
In addition to overseeing the audits of public companies and broker-dealers, the duties of the Board include: This is not to say that management is not maintaining sufficient documentation for their purposes, but the documentation may not support the testing that the engagement teams are required to perform.
In integrated audits, auditors often rely on controls to reduce their substantive testing of financial statement accounts and disclosures. In addition, an audit benefits accountants and tax collectors by addressing accounting problems and offering up-to-date information on techniques, rules, and regulations.
I remain concerned that this perspective is still not ingrained in the DNA of the profession. The SEC requires financial statements that are "accurate, truthful and complete. We are looking at what makes one engagement team do a great job when other engagement teams at the same firm are not necessarily doing a great job.
Importance of Audit in Public Sector Organizations Audit is an instrument, a tool of financial control, which is employed by the public or private sector or an individual to safeguard itself against fraud, extravagance and more importantly to bring credibility to the audited.
The Audit Report (“Report”), has a great importance for the stakeholders of a company; be it the senior managerial persons, directors, shareholders, etc.
Moreover, it is not a certification, but an opinion. Importance of Audits of Internal Controls This can create a situation where less experienced audit staff, who may not have a good understanding of the auditing standard, are performing the work without proper supervision by more experienced staff.
Importance Auditing provides assurance to investors and creditors that company funds are handled appropriately. Auditors protect the public from investing in companies that use corrupt business practices or that attempt to defraud investors with false financial statements.
What is the purpose of audit planning if the audit may not ultimately follow the carefully thought out plan? As may be inferred from Dwight D. Eisenhower's words—"Plans are worthless, but planning is everything"—the value of audit planning is not derived solely from the resulting audit plan. The Importance of Auditing to the Functioning of our Capital Markets.
At the outset I want to congratulate those of you who have chosen accounting and auditing as your field of study. Accounting and auditing professionals serve an absolutely vital role in our capital markets.Importance of auditing