The Purpose Of Audit Firms In Oxford

By Author: James Keyes
Total Articles: 62
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The purpose of audits is to provide a reasonable assurance that an assertion corresponds with a set of established and specified criteria. Auditors gather and evaluate sufficient data to determine if the assertion does, in fact, correspond to the criteria. The auditors will then prepare a communication to their opinion with regards to the degree of correspondence between the specified criteria and the assertions and will also indicate that the work they have done.

The three main kinds of audits are compliance, operational, and financial audits. With an audit of compliance, the management of an organization attests that the individual or organization is in compliance with specific regulations and/or laws. Once the auditor has gathered and evaluated all of the reliable and relevant data, the compliance auditor will then attest to the degree of correspondence between the specific regulation and/or law and the subject matter. Therefore the compliance auditor will provide assurance that the individual or organization is in compliance with the applicable regulations and/or laws.

In an operational audit, the management ...
... of an organization will attest that the organization's operations are in accordance with the established procedures and policies of management. Usually, these procedures and policies of the organization are designed by management to make sure of efficient and/or effective operations. Once the auditor has gathered and evaluated all of the reliable and relevant data, the operational auditor will then attest to the degree of correspondence between the specified procedures and policies of the organization and the actual operations. Operational audits can be the result of recommended changes to increase the efficiency and/or effectiveness of the operations.

Usually, audits of governmental agencies are both compliance and financial audits. The comptroller of the US issues the standards which are found in the Government Auditing Standards that are to be used when auditing recipients of federal funds and federal government agencies. These standards, which are also known as the Yellow Book, specify that when completing a government audit, the auditor must evaluate the compliance with all of the regulations and laws.

The three general groups of auditors are governmental, internal, and external. Auditors of the government are employed by the federal government or by a state or local agency. Auditors of the government mainly involved in the performance of compliance audits. The Government Accountability Office (GAO) and the auditors of the Internal Revenue Service (IRS) are the most visible of all government auditors. The GAO is part of the Congress of the United States which responds to Congressional requests for evaluation, review, and oversight of recipients of federal funds and federal. Therefore, GAO auditors frequently determine if the agency being audited has spent the money in a manner that is consistent with the mandates of Congress.

IRS auditors examine tax returns to ensure that individuals and organizations report their income tax in compliance with the Internal Revenue Code. IRs auditors are employees of individual organizations. Usually, in an effort to increase internal auditors' objectivity IRS auditors will report to the audit committee of the board of directors, as opposed to their management. IRS auditors are mainly involved in completing compliance and operational audits while some perform financial audits for some elements of their companies. The Institute of External auditors are certified public accountants (CPAs) that provide auditing services and are licensed by their states. The CPA profession plays an active role in creating and providing auditing, assurance, and attestation services.