Business risk approach, Auditing

Assignment Help:

Business Risk Approach

This approach requires the auditor to determine what are the very important business risks which the client faces. This line of approach both helps the client and also enables the auditor to appreciate and understand his clients business and appreciate all aspects of the business activities. It is then for the auditor to determine where the risks are likely or unlikely and whether the risks are likely to produce serious consequences. This enable the audit to be focussed on those matters where there is a possibility of misstatement. This is the basis of revised auditing standards.

The big firms have largely adopted this approach within their audit methodology.

The history of auditing shows a gradual change over time as detailed testing of transactions moved to system audits. The next development was the audit risk model which focuses the audit and the extent of audit procedures on to the areas of an audit where the auditor was most at risk of giving an inappropriate opinion.

Here we consider concept of risk from the view point of the business as a whole.


Related Discussions:- Business risk approach

Auditing, The auditors for Weston University are conducting their audit for...

The auditors for Weston University are conducting their audit for the fiscal year ended December 31, 2011. Specifically, the audit firm is now focusing on the audit of revenue from

Auditor, auditor is a watch dog not a blood hound

auditor is a watch dog not a blood hound

Audit assurance, You are the auditor of ABC Company and the audit process i...

You are the auditor of ABC Company and the audit process is almost complete. The audit report is due to be signed next week. However, the following additional information on two ma

Internal control, Ask question #MA. Evaluate the strengths and weaknesses o...

Ask question #MA. Evaluate the strengths and weaknesses of preview Company''s control environment B. What factors in Preview company''s control environment have led to and facilit

What method would you use to test an individual account bal., You are audit...

You are auditing the accounts receivable balance of a cable television provider. Individual accounts receivables tend to be similar in amount to each other and cover one or two mon

Party disclosures used by ias 24, Party Disclosures used by IAS 24 IAS...

Party Disclosures used by IAS 24 IAS 24 utilized the following related party disclosures that 1. Nature of relationships between subsidiaries and parents, even whethe

Explain an example relevant to the audit of purchases, QUESTION: (a) T...

QUESTION: (a) The auditor should get relevant and reliable audit evidence sufficient to enable him to draw reasonable conclusions therefrom: (i) What do you understand by

Difference between internal audit and external audit, Explain The Differenc...

Explain The Difference Between Internal Audit And External Audit?        Ans) The internal audit is performed to help the management. The weakness of the management is disclosed

Audit procedures, audit procedure for shares or common stock

audit procedure for shares or common stock

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd