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Posted on April 24th, 2014, by

According to the article “Preface to Codification of Statements”¯ (2010) the GAAS are the Generally Accepted Auditing Standards that were developed by the Auditing Standards Board of American Institute of Certified Public Accountants (ASB). These standards were created in order to present a framework that would serve as an ultimate source for explaining audit. It needs to be pointed out the Generally Accepted Auditing Standards are not obligatory, therefore they do not carry any authority. (“Preface to Codification of Statements”¯, 2010)

The development and promotion of the Generally Accepted Auditing Standards is the major missions of ASB. Thus, ASB serves the auditors, and also the public interest by improving existing and enabling new audit and attestation services. (Tie, 2006)

The Generally Accepted Auditing Standards consist of the following parts: the general list of tasks and requirements that auditor should fulfill/meet; the auditor’s responsibilities; the auditor’s performance; and the reporting procedure. There are ten elements of the Generally Accepted Auditing Standards could be defined.

First group which is the general list of tasks and requirements includes the following elements: the necessity of technical training and expert skills for the auditor; the requirement of the auditor’s fully independent attitudes and actions; the requirement of the diligent professional care provided by the auditor at all stages of the audit process (any misleading statements have to be obligatory reported by the auditor).

Second group of elements is related to the auditor’s responsibilities and performance, they include:Ā  the requirement of adequate planning and supervision of the auditor’s work; the ability to make the relevant assessment of the entity and the environment; the gathering of audit evidence using the audit procedures as the basis of the auditor’s work.

Finally, third group of elements consist of the standards of reporting. These elements include the following: the indication whether the generally accepted accounting principles were used by auditor has to be included into the report; if there any expectations of the principles’ use the auditor has to identify it in his/her report; if some information is considered not adequate by the auditor it needs to be mentioned in the report as well; in addition, there is the requirement to express an overall judgment of the financial statements (as a whole), and when it is impossible, the auditor needs to indicate the reasons in the report.

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