Chapter03AuditReports(审计学-英文版)rae.pptx

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1、3-12006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderAudit ReportsChapter 33-22006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder A

2、rens/Beasley/ElderLearning Objective 1Describe the parts of the standardunqualified audit report.3-32006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderParts of the StandardUnqualified Audit Report1.Report t

3、itle1.Report title2.Audit report address2.Audit report address3.Introductory paragraph3.Introductory paragraph4.Scope paragraph4.Scope paragraph5.Opinion paragraph5.Opinion paragraph6.Name of CPA firm6.Name of CPA firm7.Audit report date7.Audit report date3-42006 Prentice Hall Business Publishing,20

4、06 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderLearning Objective 2Specify the conditions requiredto issue the standard unqualifiedaudit report.3-52006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Audi

5、ting 11/e,Arens/Beasley/Elder Arens/Beasley/ElderConditions for StandardUnqualified Audit Report1.All financial statements are included.1.All financial statements are included.2.The three general standards have been2.The three general standards have beenfollowed in all respects on the engagement.fol

6、lowed in all respects on the engagement.3.Sufficient evidence has been accumulated3.Sufficient evidence has been accumulatedto conclude that the three standards ofto conclude that the three standards offield work have been met.field work have been met.3-62006 Prentice Hall Business Publishing,2006 P

7、rentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderConditions for StandardUnqualified Audit Report4.The financial statements are presented in4.The financial statements are presented inaccordance with generally acceptedaccordance with generally accepte

8、daccounting principlesaccounting principles.5.There are no circumstances requiring the5.There are no circumstances requiring theaddition of an explanatory paragraph oraddition of an explanatory paragraph ormodification of the wording of the report.modification of the wording of the report.3-72006 Pr

9、entice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderFour Categories of Audit ReportsStandard unqualifiedStandard unqualifiedQualifiedQualifiedUnqualified withUnqualified withexplanatory paragraphexplanatory paragra

10、phor modified wordingor modified wordingAdverse or disclaimerAdverse or disclaimer3-82006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderLearning Objective 3Understand combined reportingon financial statemen

11、ts andinternal control over financialreporting under Section 404 ofthe Sarbanes-Oxley Act.3-92006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderSarbanes-Oxley ActThis Act requires the auditor of a publicThi

12、s Act requires the auditor of a publiccompany to attest to managementscompany to attest to managementsreport on the effectiveness of internalreport on the effectiveness of internalcontrol over financial reporting.control over financial reporting.PCAOB Auditing standard 2 requiresPCAOB Auditing stand

13、ard 2 requiresthe audit of internal control to be integratedthe audit of internal control to be integratedwith the audit of the financial statements.with the audit of the financial statements.3-102006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/

14、e,Arens/Beasley/Elder Arens/Beasley/ElderSarbanes-Oxley ActCombined Report on Financial Statements andCombined Report on Financial Statements andInternal Control Over Financial ReportingInternal Control Over Financial Reporting1.Introductory paragraph1.Introductory paragraph2.Scope paragraph 2.Scope

15、 paragraph 3.Definition paragraph3.Definition paragraph4.Inherent limitations paragraph4.Inherent limitations paragraph5.Opinion paragraph5.Opinion paragraph3-112006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley

16、/ElderLearning Objective 4Describe the five circumstanceswhen an unqualified report withan explanatory paragraph ormodified wording is appropriate.3-122006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderUnqu

17、alified Report with Explanatory Paragraph1.Lack of consistent application of generally1.Lack of consistent application of generallyaccepted accounting principlesaccepted accounting principles2.Substantial doubt about going concern2.Substantial doubt about going concern3.Auditor agrees with a departu

18、re from3.Auditor agrees with a departure frompromulgated accounting principlespromulgated accounting principles4.Emphasis of a matter4.Emphasis of a matter5.Reports involving other auditors5.Reports involving other auditors3-132006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publis

19、hing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderConsistency VersusComparabilityChanges that affect consistency and requireChanges that affect consistency and requirean explanatory paragraph if they are material:an explanatory paragraph if they are material:1.Changes in accoun

20、ting principles1.Changes in accounting principles2.Changes in reporting entities2.Changes in reporting entities3.Corrections of errors involving principles3.Corrections of errors involving principles3-142006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Audit

21、ing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderConsistency VersusComparabilityChanges that affect comparability but notChanges that affect comparability but notconsistency:consistency:1.Changes in an estimate1.Changes in an estimate2.Error corrections not involving principles2.Error corrections not

22、 involving principles3.Variations in format and presentation3.Variations in format and presentationof financial informationof financial information4.Changes because of substantially4.Changes because of substantiallydifferent transactions or eventsdifferent transactions or events3-152006 Prentice Hal

23、l Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderConsistency VersusComparabilityThe Auditing Standards Board has issuedThe Auditing Standards Board has issueda proposal to the PCAOB to eliminatea proposal to the PCAOB to

24、eliminatethe consistency explanatory paragraph.the consistency explanatory paragraph.3-162006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderSubstantial Doubt AboutGoing Concern1.Significant recurring operat

25、ing losses1.Significant recurring operating lossesoror working capital deficienciesworking capital deficiencies2.Inability of the company to pay its2.Inability of the company to pay itsobligations as they come dueobligations as they come due3.Loss of major customers,the occurrence3.Loss of major cus

26、tomers,the occurrenceof uninsured catastrophesof uninsured catastrophes4.Legal proceedings,legislation that might4.Legal proceedings,legislation that mightjeopardize the entitys ability to operatejeopardize the entitys ability to operate3-172006 Prentice Hall Business Publishing,2006 Prentice Hall B

27、usiness Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderAuditor Agrees with a Departurefrom a Promulgated PrincipleThe auditor must be satisfied and must stateThe auditor must be satisfied and must stateand explain,in a separate paragraph orand explain,in a separate par

28、agraph orparagraphs in the audit report,that adheringparagraphs in the audit report,that adheringto the principle would have produced ato the principle would have produced amisleading result in that situation.misleading result in that situation.3-182006 Prentice Hall Business Publishing,2006 Prentic

29、e Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderEmphasis of a MatterUnder certain circumstances,the CPA mayUnder certain circumstances,the CPA maywant to emphasize specific matters regardingwant to emphasize specific matters regardingthe financial statem

30、ents,even though thethe financial statements,even though theCPA intends to express an unqualified opinion.CPA intends to express an unqualified opinion.3-192006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/Elde

31、rReports Involving Other Auditors1.Make no reference in the audit report.1.Make no reference in the audit report.3.Qualify the opinion.3.Qualify the opinion.2.Make reference in the report2.Make reference in the report (modified wording report).(modified wording report).3-202006 Prentice Hall Busines

32、s Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderLearning Objective 5Identify the types of audit reportsthat can be issued when anunqualified opinion is not justified.3-212006 Prentice Hall Business Publishing,2006 Prentice Hall B

33、usiness Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderDepartures from anUnqualified Opinion1.Scope limitation1.Scope limitation2.GAAP departure2.GAAP departure3.Auditor not independent3.Auditor not independent3-222006 Prentice Hall Business Publishing,2006 Prentice Ha

34、ll Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderQualified OpinionA A qualified opinionqualified opinion report can result from report can result froma limitation on the scope of the audit ora limitation on the scope of the audit orfailure to follow generally

35、 acceptedfailure to follow generally acceptedaccounting principles.accounting principles.3-232006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderAdverse OpinionIt is used only when the auditor believesIt is

36、used only when the auditor believesthat the overall financial statements arethat the overall financial statements areso materially misstated or misleading thatso materially misstated or misleading thatthey do not present fairly the financialthey do not present fairly the financialposition or results

37、 of operations and cashposition or results of operations and cashflows in conformity with GAAP.flows in conformity with GAAP.3-242006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderDisclaimer of OpinionIt is

38、 issued when the auditor is unableIt is issued when the auditor is unableto be satisfied that the overall financialto be satisfied that the overall financialstatements are fairly presented.statements are fairly presented.3-252006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishi

39、ng,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderLearning Objective 6Explain how materiality affectsaudit reporting decisions.3-262006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderMate

40、rialityA misstatement in the financial statementsA misstatement in the financial statementscan be considered material if knowledge ofcan be considered material if knowledge ofthe misstatement would affect a decisionthe misstatement would affect a decisionof a reasonable user of the statements.of a r

41、easonable user of the statements.3-272006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderLevels of MaterialityAmounts are immaterial.Amounts are immaterial.Amounts are material but do not overshadowAmounts a

42、re material but do not overshadowthe financial statements as a whole.the financial statements as a whole.Amounts are so material or so pervasive thatAmounts are so material or so pervasive thatoverall fairness of the statements is in question.overall fairness of the statements is in question.3-28200

43、6 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderRelationship of Materiality toType of OpinionMaterialityMaterialityLevelLevelSignificance in Terms ofSignificance in Terms ofReasonable Users DecisionsReasona

44、ble Users DecisionsType ofType ofOpinionOpinionUsers decisions are unlikelyUsers decisions are unlikelyto be affected.to be affected.ImmaterialImmaterialUnqualifiedUnqualifiedUsers decisions are likelyUsers decisions are likelyto be affected.to be affected.MaterialMaterialQualifiedQualifiedUsers dec

45、isions are likelyUsers decisions are likelyto be significantly affected.to be significantly affected.HighlyHighlymaterialmaterialDisclaimerDisclaimeror adverseor adverse3-292006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder A

46、rens/Beasley/ElderMateriality DecisionsFailure toFailure tofollow GAAPfollow GAAPAudit reportAudit reportUnqualifiedUnqualifiedQualifiedQualifiedopinion onlyopinion onlyAdverseAdverse3-302006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/B

47、easley/Elder Arens/Beasley/ElderMateriality DecisionsDollar amount compared with a baseDollar amount compared with a baseMeasurabilityMeasurabilityNature of the itemNature of the item3-312006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/B

48、easley/Elder Arens/Beasley/ElderMateriality DecisionsScopeScopelimitationlimitationAudit reportAudit reportUnqualifiedUnqualifiedQualified scopeQualified scopeand opinionand opinionDisclaimerDisclaimer3-322006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Aud

49、iting 11/e,Arens/Beasley/Elder Arens/Beasley/ElderLearning Objective 7Draft appropriately modifiedaudit reports under a varietyof circumstances.3-332006 Prentice Hall Business Publishing,2006 Prentice Hall Business Publishing,Auditing 11/e,Auditing 11/e,Arens/Beasley/Elder Arens/Beasley/ElderDiscuss

50、ion of ConditionsRequiring DepartureAuditors scope has been restricted.Auditors scope has been restricted.Statements are not in conformity with GAAP.Statements are not in conformity with GAAP.Auditor is not independent.Auditor is not independent.3-342006 Prentice Hall Business Publishing,2006 Prenti