Accounting principles and policies, Auditing

Accounting Principles and Policies

The user of the accounts expects that the accounting principles and policies used will be in conformity with IAS, be generally accepted, be widely recognized and supported and be appropriate and applicable in the particular circumstances.  This is crucial for the auditor to obtain evidence which the accounting policies required are appropriate in the circumstances, so not only acceptable.

Substance over Form          

Transaction should show the commercial reality rather than the legal form.  Therefore these would use which the accounts should display to all the liabilities assets of the organization even if lawfully the liabilities or assets do not relate to the organization.

Presentation and Disclosure

The overall result and final position can only be appreciated by aggregating transactions and balances into suitable classes and categories.  The description provided to these categories and classes must show their own true nature.

Materiality

An item is material if its disclosure or non-disclosure would make any difference to the view received by the user of the accounts.  Therefore fairness is a function of materiality.  Along with trivialities, the accounts must not be cluttered or along with statements or along with amounts which are insignificant to the overall view given through the accounts.  The auditor has to remains the concept of materiality in mind at all times.

Posted Date: 1/24/2013 7:14:52 AM | Location : United States







Related Discussions:- Accounting principles and policies, Assignment Help, Ask Question on Accounting principles and policies, Get Answer, Expert's Help, Accounting principles and policies Discussions

Write discussion on Accounting principles and policies
Your posts are moderated
Related Questions
Explain the independence between the auditor and the client on financial statement audit engagements

Work Related Health Problems The health of a person working on a specific job in a particular environment may be affected by both. It is valuable to have a clear understanding

Related Party Transactions Related party transactions-a transfer of obligations or resources among related parties, regardless of whereas a price is charged. A party is rel

Debtors - Audit Process Considering that what we have gone by on the other assets the audit work to check the figure of trade debtors should be follows as: 1) Get a schedul


Sundry Debtors and Loans Sundry debtors and loans are not generally material assets of companies another than those companies whose business is to create loans.  We shall cons

Audit Sampling ISA 530 Audit Sampling and Other Selective Testing Procedures defines Audit sampling is the application of a compliance or substantive procedure to less than 10

The Use of Engagement Letters There is a contractual relationship among an accountant and his client. The accountant must therefore make sure that at the time he decided to exe

Checking Consolidation Papers The auditor pays particular concentration to the calculation of: a) Goodwill arising on consolidation and acquisition b) Post-acquisition a

Related Parties - Audit Evidence IAS 24 prescribes the disclosures essential to the possibility to draw attention which the financial position and loss or profit of an entity