Introduction to Auditing
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These all need to be based on the United States
1. Distinguish among the three principal types of auditors and indicate the types of audits each may perform
2. Explain one of the four economic benefits of a financial statement audit
3. What is the PCAOB and what is the authority given to it.
4. Identify and describe one of the five elements of a system of quality control for a CPA firm.
5. When performing an audit, who is the audit client?
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Solution Summary
This solution provides you with information related to the three principal types of auditors and the types of audits each perform; some of the economic benefits of a financial statement audit; PCAOB and its authority; the five elements of quality control; and information about who the audit client is. The solution is adequately referenced.
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In order to answer the first question, you may state that the three principal types of auditors are external auditors, internal auditors and government auditors. External Auditors are usually independent of firms and they are required to audit the financial statements of publicly traded and private companies, partnerships, municipalities, individuals, and other types of entities. Internal Auditors on the other hand, are employed to firms and are often required to "review the reliability and integrity of information, compliance with policies and regulations, the safeguarding of assets, the economical and efficient use of resources, and established operational goals and objectives." Finally, government Auditors are normally employed to the Auditor General Office and are required to perform comprehensive audits on the financial information of Government departments and agencies.
Among one of the four economic benefits of a financial statement audit is that an audit report is done which may be used by the owners (shareholders) of the firm to comfort themselves about the financial reporting. Afterall, the main purpose of a financial statement audit is to provide an opinion as to whether or not the financial statements have been fairly stated. Note the following excerpt, which may also be used to help you to answer this question:
"In addition to ...
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