Question

Why having an independent third party performing an audit of financial statements is important.

Why having an independent third party performing an audit of financial statements is important.

Homework Answers

Answer #1

Audits performed by independent third party is necessary as there will be no conflict of interest and the quality of audit findings are best as compared to other audits.

Authorities also mandate third party audits in various cases to verify the real situation or working of an enterprise.

It also build interest and trust of shareholders and stakeholders in the company.

Third party audit is performed by certification body or registrar. Certification to an industry standard instills confidence in their customers that their quality systems meet the requirements of the chosen standard.

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Why is the audit report important in the analysis of a company? It guarantees the accuracy...
Why is the audit report important in the analysis of a company? It guarantees the accuracy of the information in the financial statements. It guarantees the accuracy of the internal controls of the company. The auditors are hired by management to assess the appropriateness of the accounting policies chosen. The auditors are an independent third party expressing an opinion on the fairness of the financial statements.
A third party independent auditor, as opposed to company management, prepares, creates, and is solely accountable...
A third party independent auditor, as opposed to company management, prepares, creates, and is solely accountable for the official Financial Statements of a publicly traded company?
After performing an audit, the auditor determines that 1.         The financial statements of a corporation are...
After performing an audit, the auditor determines that 1.         The financial statements of a corporation are presented fairly. 2.         A company's receiving department is inefficient. 3.         A company's tax return does not conform with IRS regulations. 4.         A government supply depot is not meeting planned program objectives. 5.          The financial statements of a physician are properly prepared on a cash basis. 6.         A foreman is not carrying outhisassigned responsibilities. 7.         The IRS is in violation of an established government employment...
A CPA is auditing a client's financial statements and is performing procedures to audit accounts receivable....
A CPA is auditing a client's financial statements and is performing procedures to audit accounts receivable. While reviewing the financial statements, the auditor verifies that accounts receivable is shown as a current asset. Which financial statement assertion is the auditor testing? (Select only one.) Select one: a. Rights/Obligations b. Existence/Occurence c. Presentation/Disclosure d. Valuation/Allocation e. Completeness
Why is it important for a practice administrator to know how third-party payers operate and to...
Why is it important for a practice administrator to know how third-party payers operate and to monitor changes in these operations.
1. Which of the following best describes the reason why independent auditors report on financial statements?...
1. Which of the following best describes the reason why independent auditors report on financial statements? A management fraud may exist and it is more likely to be detected by independent auditors. An audit provides credibility to the financial statements. A misstatement of account balances may exist and it is generally corrected as the result of the independent auditors' work. Poorly designed internal controls may be present. 2. Audits of financial statements are designed to obtain reasonable assurance of detecting...
Why is it important that an auditor develop an expectation of the account balance when performing...
Why is it important that an auditor develop an expectation of the account balance when performing substantive analytical procedures about the reasonableness of an account balance?  What are the audit documentation requirements when performing a substantive and the analytical procedure?
Explain why an analyst should reformulate a firm’s financial statements before performing a valuation of the...
Explain why an analyst should reformulate a firm’s financial statements before performing a valuation of the firm.
7. Financial statements of a non-public entity compiled without audit or review by an accountant, which...
7. Financial statements of a non-public entity compiled without audit or review by an accountant, which are expected to be used by a third party, should be accompanied by a report stating that: a) The scope of the accountant’s procedures has not been restricted in testing the financial information that is the representation of management. 
 b) The accountant assessed the accounting principles used and significant estimates made by management. 
 c) The accountant does not express an opinion or any other...
In general terms, why are financial statements important? (Alternatively, if you believe they are not important,...
In general terms, why are financial statements important? (Alternatively, if you believe they are not important, explain why not.)
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT