Chapter10Auditing10.1BriefIntroduction10.2AuditReports10.3AuditProcess10.4NewTechnologyinAuditing210.1

BriefIntroductionDefinition“Auditingistheaccumulationandevaluationofevidenceabouttheinformationtodetermineandreportthedegreeofcorrespondencebetweenthecompany’srecordedinformationandexternalestablishedcriteria.Auditingshouldbedonebyacompetentperson,whoisindependentofthecompanybeingexamined.”WhatistheexpansionofAUDITinthenewera?10.1

BriefIntroductionKeyPointsAccumulationandEvaluationofEvidenceAuditReportEstablishedCriteriaCompetentandIndependentPerson10.1

BriefIntroductionAuditSubjectAuditFunctionsupervision,assuranceandattestationfunction,evaluation,andconsulting……AuditObjectivepromotetheperformanceoftheauditedentity'sentrustedeconomicresponsibility510.2

BriefIntroductionRelevantRegulationsInternationalAuditingStandardsGenerallyAcceptedAuditingStandardsChineseCertifiedPublicAccountantsAuditingStandards610.2

AuditReportsStandardUnqualifiedAuditReportUnqualifiedreportwithexplanatoryparagraphormodifiedwordingQualifiedAdverseanddisclaimer7FindAuditReportandObserve10.2

AuditReportsStructureofReportReportTitleAuditreportaddressOpinionThebasisandscopeofauditworkCriticalauditmattersManagement’sresponsibilityAuditor’sresponsibilityNameofCPAsNameandAddressofCPAfirmAuditreportdate810.2

AuditReportsStandardUnqualifiedAuditReportFinancialstatementspresentfairly,inallmaterialrespects,inconformitywithaccountingprinciplesgenerallyaccepted.Sufficientappropriateevidencehasbeenaccumulated,andtheauditorhasconductedtheengagementinamannerthatenableshimorhertoconcludethattheauditwasperformedinaccordancewithauditingstandards.Thescopeoftheaudithasnotbeenrestricted.Therearenocircumstancesrequiringtheadditionofanexplanatoryparagraphormodificationofthewordingofthereport.910.2

AuditReportsUnqualifiedAuditReportwithEmphasis-of-MatterExplanatoryParagraphorModifiedWordingThescopeoftheaudithasbeenrestricted(scoperestriction)Auditorisnotindependent“Lackofconsistentapplicationofgenerallyacceptedaccountingprinciples;Substantialdoubtaboutgoingconcern;Auditoragreeswithadeparturefrompromulgatedaccountingprinciples;Emphasisofothermatters;Reportsinvolvingotherauditors”1010.2

AuditReportsQualifiedReportWhenanauditorissuesaqualifiedreport,heorshemustusetheterm“qualified”and“exceptfor”intheopinionparagraph.Theimplicationsisthattheauditorsatisfiedthattheoverallfinancialstatementsarecorrectlystated“exceptfor”aspecificaspectofthem.1110.2

AuditReportsAdverseOpinionReportoverallfinancialstatementsaremateriallymisstatedormisleadingtotheextentthattheydonotpresentfairlythefinancialpositionorresultsofoperationsandcashflowsinconformitywithGAAP.1210.2

AuditReportsDisclaimerofOpinionReportthescopeoftheauditissignificantlylimitedanditsimpactisextensiveanon-independentrelationshipundertheCodeofProfessionalConductbetweentheauditorandtheclientmultipleuncertaintiesthathavemutualinfluence.1310.3

AuditProcessPhaseOne:PlanandDesignObtainanunderstandingoftheentityanditsenvironment.UnderstandinternalcontrolsandassesscontrolriskAssessriskofmaterialmisstatements1410.3

AuditProcessPhaseTwo:TestsofControlsandSubstantiveTests1510.3

AuditProcessPhaseThree:AnalyticalProceduresAnalysisofplausiblerelationshipsTestsofdetailsofbalances1610.3

AuditProcessPhaseFour:CompleteandIssueanAuditReport1710.4

NewTechnologyinAuditingApplicationFieldsDataanalysisa