Need help with questions: Determine why it is important to have auditing standards. Specifically, why are ethics important to the auditing profession?Explain why independence is such an important requirement for auditors. Who gets hurt when accountants and auditors fail to live up to high ethical standards?
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Need help with questions: Determine why it is important to have auditing standards. Specifically, why are ethics important to the auditing profession?Explain why independence is such an important requirement for auditors. Who gets hurt when accountants and auditors fail to live up to high ethical standards?
The importance of auditing standards
Auditing standards are the backbone of any auditing process. Auditors while performing their audit functions, should adhere to the auditing standards. Auditing standards that are widely acknowledged as best practices should be well understood by the auditor.
The auditing standards are applicable whenever an independent audit is performed, which includes any independent review of financial data of any entity, regardless of whether it is profit-oriented or not, and regardless of its size or legal structure, when such a review is done with the intention of expressing an opinion. Other relevant duties of auditors may also be covered by the auditing standards, where applicable.
The structure of an audit firm's practice, the way in which its professional staff is hired, trained, and compensated, the services it offers to customers, the way engagements are carried out, the way it is required to report its activities, and many other factors are governed by standards. As well as establishing ethical standards, independence requirements, quality control standards, and audit performance and reporting criteria, several professional and regulatory agencies have also developed quality control standards.
In order to help the auditor decide the amount of the audit methods and procedures that should be used to achieve the audit objective, auditing standards offer the auditor the bare minimum guidelines. They serve as the benchmarks or criteria used to assess the audit results' level of quality. Auditing standards serve a variety of purposes. It can offer a foundation for carrying out a variety of auditing tasks. As a result, auditors may carry out their audit in a uniform and systematic manner.
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