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The Importance Of Professional Skepticism

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Throughout the period of the audit assignation PCAOB describes professional skepticism as a general duty of care that need to be applied by the examiner. Professional Skepticism is when someone has a questioning mind, that involves a critical assessment and analyze of audit evidence. It is primordial for an auditor to exercise professional skepticism when conducting the audit of financial statements. In order word, an auditor must refer to quality and credible reference. The auditor needs to question everything (words or data presented) that managers are feeding them in order to achieve reasonable assurance about the conclusiveness of evidence. In the end, this kind of attitude helps detecting fraud prior to the issuance of a company’s financial …show more content…
There are two equally important aspects independence: independence of mind and independence in appearance. For independence of mind, the key part is that the auditor as a public servant must be impartial towards the client. In other words, the auditor must arrive at an unbiased opinion toward the fairness and dependence of the client’s financial statements. It is important to know that independence is not to suggest having the approach of a prosecutor, but instead, as a branch that understands a duty of fairness, not just to management/owners, but similarly to creditors and those who may otherwise rely upon the independent auditor’s report, as in the case of prospective owners or creditors. However, for independence in appearance, it relates to others’ perception. For instance, the auditor cannot hold any shares or be acquainted with the internal users of the company. If this happened, even if the auditor is unbiased on his report, third party can see the auditors as lacking independence. Been independent is really important to a trustworthy auditor’s report. A professional auditor has to be independent and seen to be …show more content…
Independence in mental attitude concerns the auditor's state of mind. It deals with inappropriate biases when auditing a firm. Whereas, independence in appearance, is avoiding circumstances that make well informed third parties believe that the auditor is not truly independent. Furthermore, independence in appearance additionally lowers the prospect for an auditor to act otherwise than impartially, which afterward improves trustworthiness to the audit report. If an auditor is in fact autonomous, but some factors imply the opposite, this might possibly lead to the assumption that the audit is biased and

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