Audit Flashcards
AASB
Auditing and Assurance Standards Board
ISA
International Standards on Auditing
IAASB
International Auditing and Assurance Standards Board
CSQC
Canadian Standards on Quality Control
CAS
Canadian Auditing Standards
OCS
Other Canadian Standards
CPAB
Canadian Public Accountability Board
CSA
Canadian Securities Administrators
Clean audit opinion
A clean opinion can be defined as an unqualified independent auditor’s report, the clean report, issue for the organization’s financial statements. This kind of report confirms that the company’s financial statements do not have any matter come from error or fraud.
Qualified audit opinion
Report that states that financial statements of the organization are not free from error or fraud.
PEG
Professional Engagement Guide
Inherent audit risk
Inherent audit risks are the risks that the material misstatements could possibly happen in financial statements due to other reasons rather than the failure of internal control over financial reporting as well as detection risks.
Control audit risk
Control risk, which is the risk that a misstatement due to error or fraud that could occur in an assertion and that could be material, individually or in combination with other misstatements, will not be prevented or detected on a timely basis by the company’s internal control.
Audit Risk Model
AR = RMM * DR
AR - Audit risk
RMM - Risk of Material Misstatement
DR - Detection Risk
RMM = IR * CR
IR - Inherent risk
CR - Control risk
Pervasive Risks
Pervasive means found everywhere or spread everywhere. Risks that cannot be isolated to a specific account balance, class of transactions, or presentation and disclosure and therefore they exist at the OFSL.
