Week 10 Auditing Issues

Auditing Issues - TR Week 10 Most people have the same feeling when they hear the word audit. It usually implements fear in a person, even though that person may have done nothing wrong. Fear is common when the auditors are being brought in because most people don 't know what to expect. This is also true when audits are being done for businesses. I know from personal experience that the auditors are not always greeter with kindness. I currently working in an accounting firm and have had the privilege to go on audits with my company even though I do not yet have my degree. People need to understand that the auditors do not need to be fear but need to be respected for what they are doing. It is not an auditors goal to ruin someone
I do not want to just focus on one auditing issue because there are so many that can lead to big problems for a company. The following will be the top five issues I have found while doing my research on auditing issues. The first issue I would like to discuss is the gathering of sufficient audit evidence during the audit process. One of the reasons that gathering evidence is so important is because it backs up the information that a company or an individual is supplying the auditor. This is one way the auditors get their information. This being the case it means that the auditors need to question management when they might see a deficiency in any of the accounting materials. If they do not question the materials then they are not fully performing their job. (Beasley, Carcello, & Hermanson, 2001) In an article written by Kathleen Hoffelder 87 cases where the SEC was investigating fraud, 73 percent of those cases did not have sufficient audit evidence. These cased were pulled from 1998 to 2010. One of the interesting things about this study is that only 11 of the 87 cases that were studied happened after 2003. The reason that this is interesting is because a little over a year earlier was when Sarbanes Oxley was put into effect. This helps to show that SOX is a process that is starting to work. It is showing that more auditors are taking the time and care needed to properly
There are many factors that are going to affect the due professional care on both the auditors end and the clients side. For example, the auditors conduct can play a big role. If the auditor goes in with the attitude that they are going to find a problem within the company it is going to cause the clients to be uneasy during the process which could make them unresponsive towards the auditor and could make them less receptive toward any of the recommendations that the auditor way give. It 's also important because most of the time the auditor 's report will include notes about how the client acted toward recommendations that may have been given. They are not trying to hurt the company the auditors are trying to help. That 's why it is important for the auditor conduct to remain professional and unbiased. (ISACA,