Generally Accepted Auditing Standards

Auditing is an organized impartial examination of data, statements, records, operations, and performance of a company. An auditor, which is a Certified Public Accountant is the person assigned to perform all audits. The purpose of an audit is to ascertain the validity and reliability of a company’s information, and to assess the company’s internal control system. The goal of all audits is to determine whether a company’s financial statements comply with the generally accepted accounting principles set forth by its jurisdiction (Investopedia).

There are guidelines that all auditors use when they are performing an audit. These guidelines are the generally accepted auditing standards and they provide the objectives for the auditor to achieve in an audit of financial statements. There are ten standards and they are set up into three categories, which are general standards, standards of fieldwork, and standards of reporting. These standards pertains to financial audits (an audit of financial statements to find out if they are prepared in accordance with guidelines), operational audits (evaluates the effectiveness of a company’s operations), and compliance audits (evaluates whether a company is following rules and regulations).

In the general standards category there are four different standards. These standards deal with the qualifications of the auditor and the quality of the audit. The first standard is adequate technical training and proficiency, which states that the auditor must have adequate technical training and is proficient as an auditor (Boynton & Johnson, 2006). The auditor must have formal college education, training, and experience in auditing, and continuing professional education while the auditor is working in the field of auditing.

The second standard is independence in mental attitude. No