Auditing standards help companies establish adequate operating controls.
Auditing and assurance standards help auditors review corporate controls, procedures and systems in accordance with generally accepted auditing standards. These standards also help auditors ensure that employees abide by laws and regulations.
Auditing Defined
Auditing is a business process in which a specialist reviews the controls of a company, ensuring that they are adequate and functional.
Assurance Defined
Assurance services allow an external expert to provide an opinion regarding the work of another person. Audit services are part of assurance engagements.
Engagement Discussions
An auditor must discuss significant issues with a company's management before starting control tests and reviews. These issues may relate to test planning and review scheduling.
Control Testing
An auditor tests controls to ensure they are operational. A control is a set of instructions that management puts into place to prevent losses.
Risk Assessment
Risk assessment procedures allow an auditor to review corporate controls and rate risks as "tier 1," "tier 2" and "tier 3," depending on the loss expectation.
Report Issuance
An auditor issues a final report after discussing "tier 1" and "tier 2" issues with senior management and reviewing mitigating measures.
