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Perspectives on Audit - Why accounts need to be audited and can a legal action be brought against auditors if they make mistakes
The first 200 words of this essay...
1 INTRODUCTION 2
? STAGES IN AUDIT PROCESS 2
2 WHY ACCOUNTS NEED TO BE AUDITED 2
2.1 MISCONCEPTION ABOUT THE ROLE OF AUDITORS 2
2.2 THE DIFFERENCE BETWEEN ACCOUNTING AND AUDIT 3
2.3 THE NATURE, SCOPE AND PURPOSE OF AUDITING 3
THE AUDIT OPINION 4
REPORTING REQUIREMENTS 4
SCOPE OF AN AUDIT OF FINANCIAL STATEMENTS 4
2.4 STAGES IN AUDIT PROCESS 5
3 CAN A LEGAL ACTION BE BROUGHT AGAINST AUDITORS IF THEY MAKE MISTAKES? 5
3.1 LEGAL RESPONSIBILITIES OF AUDITORS 5
3.2 LIABILITY TO SHAREHOLDERS 5
3.2.1 Due Care 6
3.2.2 Negligence 6
3.2.3 Privity of contract 6
3.2.4 Causal relationship 7
3.2.5 Contributory negligence 7
3.2.6 Damages 7
3.3 LIABILITY TO 3RD PARTY 7
3.4 AUDITOR PROFESSIONAL ETHICS 8
4 CONCLUSION 8
Perspectives on Audit: Why accounts need to be audited and can a legal action be brought against auditors if they make mistakes?
This report will examine two aspects of auditing, the first aspect to be explored will be; the reason to why accounts need
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