AFM 201 Audit: Midterm 1 Fall 2011 Joanne Toporowski. Introduction to Auditing. Why do we conduct audits? V erification of information without self-review Three party accountability First party: auditor Second Party: accountable party Third Party: user Auditors vs. other professionals.
7. Perform the Audit Tests and Evaluate the results
8. Form an opinion
9. Issue the appropriate report
Audit Risk = Inherent Risk x Control Risk x Detection Risk
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of F/S.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.