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I would like to know about preconditions for an audit.
Why do auditors need preconditions for an audit? and is it helpful for auditors’ works ? If useful for auditor, How useful?
I think it is agreement between auditors and management, so what management responsible for it?Thanks.
Lyn Kyi PhyoIt’s not so much helpful as necessary. You can’t do an audit if the financial reporting framework to be applied in the preparation of the financial statements is not appropriate. It is also essential that management accepts its responsibilities: internal control, preparation of financial accounts, suppplying all the information and explanations asked for by the auditor etc.
Thank for your solution.
It means that auditor can do auditing the financial statement if financial reporting framework are acceptable.
And also auditor can audit, if there is applicable financial reporting framework,internal control at preparing financial statement and relevant information can be provided by management and auditor have right to unrestricted access to all information and staff.please let me know if my understanding is wrong.
LKP
They can audit even if there is no good internal control system (many companies don’t), but management should redognise that that is their failing, not the auditor’s.
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