Answered: Discuss briefly: (i) The independent…

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Accounting

Discuss briefly: (i) The independent auditor’s report describing the scope of the statutory audit.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Discuss briefly: (i) The independent auditor’s report describing the scope of the statutory audit. (ii) An audit’s main limitations (iii) The implementation of the overall audit strategy. (iv) How to Understand the entity and its environment (v) The Fundamental principles as they relate to the Duty of confidentiality

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The auditor should consider audit risk when planning and performing an audit of financial statements. Audit risk should also be considered together in determining the nature, timing, and extent of auditing procedures and in evaluating the results of those procedures. Required: a. Define audit risk. b. Describe the components of audit risk (e.g., inherent risk, control risk, and detection risk). c. Explain how these components are interrelated. (AICPA, adapted)
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