Normal audit risk, Auditing

Normal audit risk
Indications that an audit is a normal risk audit are:

(1) The client having management and staff who are competent and have integrity;

(2) Where the client has an accounting system that is well designed, works and is subject to strong internal controls;

(3) Where the client has no special financial problems;

(4) The auditor's past experience;

(5) Where the client is old, well established and the business of the entity is not subject to rapid change;

(6) If the client's board of directors are actively engaged in the company and they provide control and leadership of a good quality;

(7) If the board of directors has competent non-executive directors;

(8) If the organization has an audit committee.

When the auditor is faced with the normal audit risk, the audit approach adopted is usually one of reliance on key controls supported by substantive tests, compliance tests and analytical review.

Posted Date: 12/3/2012 5:49:33 AM | Location : United States

Related Discussions:- Normal audit risk, Assignment Help, Ask Question on Normal audit risk, Get Answer, Expert's Help, Normal audit risk Discussions

Write discussion on Normal audit risk
Your posts are moderated
Related Questions
What fundamental accounting concepts must you keep in mind in preparing to carry out your audit? Accounting Concept and Records Fundamental Accounting concepts are cove

Blowing the Whistle on Former Partners On St. Patrick's Day in 1992, Chambers Development Company, one of the largest landfill and waste management firms in the United States, a

Necessity of Transactions with Related Parties Transactions along with related parties are essential for several reasons: (a) Several financial scandals including related p

Conducting a critical review of published literature about a topic is fundamental step in developing your research skills. A first step towards a review of the literature is to sea

Benefits of Internal Audit are following: It is in-expensive. No charted accounted is needed to audit internally. Faults will be removed before preparing financial stateme

Initial Identification - Intangible Asset Subsequent to initial identification, an intangible asset is carried at: a) Cost, less any accumulated amortization and any accumu

Advantages and disadvantages

Government has recently set up a parastatal body responsible for waste management in Mauritius. The management is unsure as to the need for an audit and the setting up of an intern

Litigation and claims ISA 501 Audit Evidence - Additional Consideration for exact Items requires such auditors should carry our process to become aware of any material litig

Going Concern Considerations - Audit Process IAS 1 Presentation of Financial Statements knows the going related assumption as one of the fundamental assumptions that underlie