THE ROLE OF AUDITORS IN CONTEMPORARY TIME

  PREFACE This write-up focuses that auditors express important opinion on financial statement. And it describe the principles and technique that auditor use to ascertain the true and fair view of financial statement. Therefore the primary aim of this work is to provide a simple but thorough approach to understanding of auditing concepts principles and techniques. It start in chapter one the introduction and theoretical frame work of auditor chapter two meaning of auditor and auditing the right and duties of auditors and other point that contain in this work. Chapter three focuses on summary of role of auditors which follows by conclusion and recommendation.                    TABLE OF CONTENT TITLE PAGE APPROVIAL PAGE DEDICATION ACKNOWLEDGEMENT PREFACE TABLE OF CONTENT               CHAPTER ONE 1.1        INTRODUCTION 1.2        THEORITICAL FRAME WORK                CHAPTER TWO 2.1         MEANING OF AN AUDITING AND AUDITOR 2.2         DIFFERENT BETWEEN ACCOUNTING AND AUDITING 2.3         THE ROLE OF AUDITOR [INTERNAL AND EXTERNAL] 2.4         EQUALIFY  AND UNEQUALIFY AUDIT REPORT 2.5         THE AUDITOR AS A WATCH DOG 2.6         COMPUTR AND AUDITING [ROLE OF AUDITOR 2.7         AUDITOR LIABILITY 2.8         REMOVAL AND APPIONTMENT OF AUDITOR 2.9         CHANGES THAT HAVE OCCURRED IN THE DUTIES OF AUDITORS  CHAPTER THREE SUMMARY CONCLUSIPN RECOMMENDATION BILOGRAPHY                 CHAPTER ONE 1.1      INTRODUCTION The role of an auditor are impressed by the layman is that of an auditor being in quest of errors, theft, defalcation and fraud. But  the impression of various accounting society on the role of auditor cuts across this limit of layman view. Accountant see the purpose of audit by an auditor beyond the layman view to include the inquiry of the truth and fairness of the entity affairs as represented in their records, whether they have prepared it in accordance with the general accepted financial statement of the current period and the proceeding period and, conform the statutory requirement. The observance of generally accepted auditing standards, the auditor must exercise sound professional judgment in determine the auditing procedures, which will lend a reasonable basis for his opinion. In the case of unqualified opinion auditors should not make to be thought have represented that no undetected fraud exist or grant that the financial statement is of affair representation of the financial position and result of operation. for instance this implies that he should portray the expertise of the medical doctor in guaranteeing theta an operation will be successful. The auditors responsibility to detect fraud is determine by audit survival instruct users demand and, regulatory imposition and requirement of financial statement. Historical detection of fraud was and major audit objective influenced by Mckenons Robins case (1940) and the 1939 statement on auditing procedures No 1, extensions of audit procedures, which states that “ordinary examination incident to the starting of an opinion representing financial statement in not designed and can not be relied opinion to disclose defalcation and other similar irregularities. My purpose of this term paper is to discuss the role an auditor performed in the conduct of an audit in an entity to the extent of this job, the qualification required of him, distinguishing his function to that of an accountant and to know when a report is qualified or unqualified. Thus auditing controls the financial activities of a company to our tail fraudulent act and to ascertain the true and fair view of the financial statement Of financial Statement of that company. 1.2        THEORITICAL FRAME WORK (3)       The continuous change in pace of business systems and the impact of statute and the publics request to has changed the role of auditors over time. In next chapter we will examine the concept of audit, the meaning of auditor, their roles both internal and external the work of an auditor as distinct from that of an accountant, the auditors role as it concern the third parties. We will go further to discuss as it relates to computer.                                          CHAPTER TWO MEANING OF AUDIT AND AN AUDTIOR 2.1      What is an Audit? The meaning of an audit has been defined by many people in various ways. Such person include, Taylor, Santotey (1974) Okolo J. U. T.(1987), etc. but standard definition of an audit is given by the auditing practice board (APB), which defines audit as: “ An adult of financial statement is an exercise whose objective is to enable and tiers to express an opinion whether the financial statement present a true and fair view or [equivalent] of an entity’s profit at the period end and of its profit or loss [or income and expenditure] for the period then ended and have been properly prepared in accordance with the applicable report frame work  [for instance relevant legislation and applicable accounting standards] or where statutory or other specific requirements prescribe the term presented fairly.” Who is an Auditor? An auditor is an expert in accounting field and must possess a thorough knowledge if book keeping, accounting costing under the companies act of 1986 and CAMD 1990. he is to report whether in this opinion the balance sheet and profit and loss account of an entity presents a true and fair view by making sure of proper book of accounts were kept and recived from branches not visited by them and whether the companies balance sheet and profit and loss of account agree with the books of account and return made. and for him to express such opinion he requires a standard knowledge of accounting and able to apply his knowledge in any set of circumstances. He must also have a practical understanding of various business and understand its technical details and the method of the business whose account he is called up to audit so as to be able to apply his knowledge to any prevailing circumstances of such business. An auditor requires a considerable legal knowledge of record he auditing his relationship of record with his client as concern influence from factors which may deviate his duty as an auditor from what it should be. In other words he must carry out his work faithfully in spite of his clients or others opinion against his in the proper exercise of his duty and the effect they will have on him. He must be careful in his exercise of his work by being sure or understands and completely satisfied with the extent of inquires as concern the exact state of affairs of the entity. He must be a number of either of the following. He must have passed any of the recognized professional body such as the; i.             The institute of chartered accountants of Nigeria [ICAN]                      ii.            The institute of chartered accountants of England and Wales, Scotland [ICA] iii.          The association of the certified accounts [ACA] iv.          Certified public account [ApA] -                    Recognized by the department of trade as having similar qualification -                    Having obtain adequate knowledge and experience gained in the course of his employment by a qualified accountant. Therefore, an auditor is a competent and impartial critic appointed to verify a financial or other statement of accounts and to satisfy that the statement present a correct view of the affairs of the entity concerned. 2.2        DIFFERENCE BETWEEN ACCOUNTING AND AUDITING. Auditing as interpreted by many people as the same thing with accounting. This is not true in that auditing is associated with according auditing is the scrutinizing of accounting records. Thus, the preparation of account is one thing while the verification and criticism is another. This distinction becomes imperative when the question of legal liability arises, on whether the auditor was instructed to perform accountancy work or auditing. The accountants job is not to verify or critize the work carried out by him in other words cannot guarrants it but, it is the function of an auditor, although the auditor is an accountant his job is an audit is distinct from functioning as in book-keeping or recording of accounts. In the case of Apples vs. Anna Dexter and co.(1926) the emphasis was on the definition of the work of the defendant as distinct from that implied by the plaintiff.       2.3        THE ROLE OF AUDITORDS [INTERNAL AND EXTERNAL]                             INTERNAL AUDITORS He is an employee of an entity who report to managing director or the chief account on the operations and the system of internal control reviewed by him so as to make recommendation for possible impossible improvement to enhance performance. The statement of responsibilities of the internal auditor state clearly his role as part of the management team and as part of control function. Internal auditing is a managerial control function, which measure and evaluates the effectiveness of other controls. Thus the internal auditing is an independent appraisal activity within an organization for review of accounting, financial and other operation as a basis from services to management. The over all internal of auditing is, assisting management in the effective discharge of responsibilities, by finishing them with objective analysis, appraisal, recommendation and pertinent comment concerning the activities reviewed attainment of this over all objective: -                    Reviewing and appraising the soundness, adequacy and application of accounting, financial and operating controls. -                    Ascertaining the extent to which a company asset are accounted for the reliability. -                    Ascertaining the extent of compliance with established policies, plan and procedure. -                    Ascertaining the reliability of accounting and other data developed in the organization. -                    Appraising the quality of performance in carrying out assigned responsibility . The detection of fraud and irregularities is the duty of management who adopts and maintains adequate and effective system of internal control for properly and if not he report to management his recommendation for amendment.             EXTERNAL AUDITORS The external auditor is not an employee of entity and is not responsible to the managing director or chief accountant of the firm rather his function is to examine the financial statement and express his opinion as to the fairness they purpose to present. The financial statement are the representation and primary responsibilities, and for independent auditors to express his opinion on such financial statement his report may be in form of qualified, unqualified or adverse report, when the auditor does not have sufficient information upon which to base his opinion, he will issue a disclaimer of opinion and state his reasons for doing so. In case of qualified or adverse opinion the auditor will also state the reasons for his opinion. In doing this, he may issue a piece-meal opinion covering those items that are included or excluded in his opinion. The CAMD 1990 defines the auditors responsibility that his is only responsible for detecting error or fraud affects the financial statement materially. Get the Complete Project Material Now!!!