AUDITING AND ASSURANCE:
2 | A GUIDE TO UNDERSTANDING AUDITING AND ASSURANCE
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First published 2013
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A guide to understanding auditing and assurance: Listed companies
Why are audits and reviews required?
What does assurance mean?
What is an audit of financial statements?
What is a review of financial statements?
Relationships in financial reporting
The auditor’s report
Modified auditor’s reports
How can you tell if the auditor’s report is clean or not?
What is auditor independence?
What do auditors and reviewers do?
What does materiality mean?
What do auditors do in regard to fraud?
What do auditors do in regard to going concern?
Does a clean auditor’s report mean a clean bill of health for the company?
Does the auditor sign off on the whole annual report?
What is audit quality?
Difference between internal and external audit
Appendix 1 – Glossary
Appendix 2 – Example auditor’s report
4 | A GUIDE TO UNDERSTANDING AUDITING AND ASSURANCE
CPA Australia acknowledges the work of the External Reporting Centre of Excellence.
CENTRE OF EXCELLENCE
David Hardidge FCPA
Indra Abeysekara CPA
Tong-Gunn Chew FCPA
Ric De Santi FCPA
Thomas Egan FCPA
Amir Ghandar FCPA Technical Support and Lead Author
Piotr Jakubicki CPA
Alan Lee CPA
Jeffrey Luckins FCPA
Mark Shying CPA
Julie Sinclair FCPA
A GUIDE TO UNDERSTANDING AUDITING AND ASSURANCE | 5
Auditing and assurance play an essential role in the effective operation of our capital markets and the economy at large, providing confidence to current and prospective shareholders about the information disclosed by companies.
A guide to understanding auditing and assurance: listed companies explains the value and purpose of auditing and assurance in plain language. This should assist shareholders who are…