A profession regulated by accountancy bodies that oversees the activities of accountants, encompassing the process of accounting.
An Accountant's Opinion is a statement signed by an independent Certified Public Accountant that describes the scope of the examination of an organization's books and records. It provides important assurance to lenders or investors.
Attributes sampling is a statistical sampling method used to estimate the proportion of a population that possesses a specific attribute, commonly utilized by auditors in compliance tests to identify deviations from required control procedures.
An independent examination and subsequent expression of opinion on the financial statements of an organization, involving collecting evidence through compliance and substantive tests.
The Audit and Assurance Council is a body established in 2012 to advise the Financial Reporting Council on matters related to audit and assurance, including the issuance of codes and standards. Unlike its predecessor, the Auditing Practices Board, the Council has a more limited and purely advisory role.
An audit trail, also known as a paper trail, is the sequence of documents, computer files, and other records that provide detailed evidence of a transaction, allowing auditors to trace and verify the integrity of the transaction from start to finish.
An auditor is a person or firm appointed to carry out an audit of an organization, ensuring financial statements are accurate and adhere to regulations.
A Balance Sheet Audit focuses specifically on verifying the existence, ownership, valuation, and presentation of a company's assets and liabilities as stated in the balance sheet.
A bank certificate is a document signed by a bank manager that certifies a company's account balance on a specified date. It is often requested during audits to verify a company's financial status.
A Bank Confirmation is a request made by an auditor to a bank to confirm details related to an audit client's bank accounts, assets held by the bank, and associated financial information.
A company auditor examines the financial statements of a company to ensure accuracy and compliance with the Companies Act. Since 1989, appointment as a company auditor is restricted to registered auditors only.
Tests used during an audit to determine the effectiveness of a company's control procedures. The extent of compliance testing will depend upon the extent to which specific controls are relied upon. Results of compliance testing will indicate the necessary level of substantive testing (tests of transactions, balances, etc.). If controls are found to be working well, substantive testing may be reduced to some extent.
A continuous audit is an in-depth examination of financial records conducted on a recurring basis throughout the accounting period, aimed at detecting and correcting mistakes and improper accounting practices before the reporting year-end.
A code of best practice in corporate governance that outlines expected standards for UK's listed companies, originally issued with the Hampel Report of 1998.
A deficiency in tax occurs when a taxpayer's correct tax liability exceeds the taxes previously paid for that taxable year. It can be identified during an audit of the taxpayer's return and may lead to penalties.
Deloitte is one of the 'Big Four' international professional services firms providing audit, consulting, financial advisory, risk management, tax, and related services globally.
The European Court of Auditors (ECA) is the independent body responsible for auditing the accounts of European Union (EU) institutions. Founded in 1977 and obtaining legal status under the Treaty of Maastricht in 1992, the court ensures that EU funds are spent legally and efficiently.
The extent of the errors that an auditor expects to find when performing substantive tests on a population or a sample of it.
The Government Accountability Office (GAO) is the audit and investigation department of the U.S. Congress, established in 1921. The GAO’s mission is to carry out financial and performance audits of government organizations and programs.
An inventory certificate is a management representation to an independent auditor regarding the inventory balance on hand. It typically details the method used in computing inventory quantity, pricing basis, and condition.
A joint audit is an audit conducted by two or more auditing firms who collaborate to prepare a single audit report, enhancing the overall audit quality and credibility.
A judgment sample is a determination by an auditor, based on personal experience and familiarity with the client, of the number of items, as well as the particular items, to be examined in a population. This function allows the accountant to maintain objectivity and thoroughness in testing the sampled items for accuracy.
KPMG is one of the Big Four international professional services networks, providing audit, tax, and advisory services across over 150 countries.
A letter written by an auditor to the management of a client company at the end of the annual audit to suggest possible improvements to the company's accounting and internal control systems or to communicate other beneficial information.
A secondary auditor is an auditor assigned to audit the financial statements of a subsidiary company, who is not the same auditor as the one auditing the parent company's financials.
An inquiry set up by the Financial Reporting Council (FRC) in 2011 to examine the reporting of liquidity risk and other factors that may threaten the viability of an entity as a going concern, triggered by the financial crisis of 2007-08.
A substantive test in auditing is employed to verify the existence, ownership, and valuation of assets and liabilities, often used to perform a balance-sheet audit or gather general audit evidence.
An unqualified opinion is an independent auditor's opinion that a company's financial statements are fairly presented, in all material respects, in conformity with generally accepted accounting principles (GAAP). It is also referred to as a clean opinion.
A value for money audit (VFM audit) is an audit of a government department, charity, or other non-profit organization to assess whether it is functioning efficiently and delivering value for the money it spends.
A substantive test in an audit to verify that the underlying records accurately represent the transactions entered into by the audited business.
