Accounting, also known as accountancy, is the process of recording and processing information about economic entities, such as businesses and corporations. Accounting measures the results of an organization's economic activities and conveys this information to a variety of stakeholders, including investors, creditors, management, and regulators. Practitioners of accounting are known as accountants. The terms "accounting" and "financial reporting" are often used interchangeably.
An audit is an "independent examination of financial information of any entity, whether profit oriented or not, irrespective of its size or legal form when such an examination is conducted with a view to express an opinion thereon." Auditing also attempts to ensure that the books of accounts are properly maintained by the concern as required by law. Auditors consider the propositions before them, obtain evidence, roll forward prior year working papers, and evaluate the propositions in their auditing report.
A financial audit is conducted to provide an opinion whether "financial statements" are stated in accordance with specified criteria. Normally, the criteria are international accounting standards, although auditors may conduct audits of financial statements prepared using the cash basis or some other basis of accounting appropriate for the organization. In providing an opinion whether financial statements are fairly stated in accordance with accounting standards, the auditor gathers evidence to determine whether the statements contain material errors or other misstatements.
An auditor's report is a formal opinion, or disclaimer thereof, issued by either an internal auditor or an independent external auditor as a result of an internal or external audit, as an assurance service in order for the user to make decisions based on the results of the audit.
Founded in 1904, the Association of Chartered Certified Accountants (ACCA) is the global professional accounting body offering the Chartered Certified Accountant qualification (ACCA). It has 240,952 members and 541,930 future members worldwide. ACCA's headquarters are in London with principal administrative office in Glasgow. ACCA works through a network of over 110 offices and centres in 51 countries - with 346 Approved Learning Partners (ALP) and more than 7,600 Approved Employers worldwide, who provide employee development.
An information technology audit, or information systems audit, is an examination of the management controls within an Information technology (IT) infrastructure and business applications. The evaluation of evidence obtained determines if the information systems are safeguarding assets, maintaining data integrity, and operating effectively to achieve the organization's goals or objectives. These reviews may be performed in conjunction with a financial statement audit, internal audit, or other form of attestation engagement.
An information security audit is an audit of the level of information security in an organization. It is an independent review and examination of system records, activities, and related documents. These audits are intended to improve the level of information security, avoid improper information security designs, and optimize the efficiency of the security safeguards and security processes. Within the broad scope of auditing information security there are multiple types of audits, multiple objectives for different audits, etc. Most commonly the controls being audited can be categorized as technical, physical and administrative. Auditing information security covers topics from auditing the physical security of data centers to auditing the logical security of databases, and highlights key components to look for and different methods for auditing these areas.
The Committee of Sponsoring Organizations of the Treadway Commission (COSO) is an organization that develops guidelines for businesses to evaluate internal controls, risk management, and fraud deterrence. In 1992, COSO published the Internal Control – Integrated Framework, commonly used by businesses in the United States to design, implement, and conduct systems of internal control over financial reporting and assessing their effectiveness.
Generally Accepted Auditing Standards, or GAAS are sets of standards against which the quality of audits are performed and may be judged. Several organizations have developed such sets of principles, which vary by territory. In the United States, the standards are promulgated by the Auditing Standards Board, a division of the American Institute of Certified Public Accountants (AICPA).
A going concern is an accounting term for a business that is assumed will meet its financial obligations when they become due. It functions without the threat of liquidation for the foreseeable future, which is usually regarded as at least the next 12 months or the specified accounting period. The presumption of going concern for the business implies the basic declaration of intention to keep operating its activities at least for the next year, which is a basic assumption for preparing financial statements that comprehend the conceptual framework of the IFRS. Hence, a declaration of going concern means that the business has neither the intention nor the need to liquidate or to materially curtail the scale of its operations.
The Financial Reporting Council (FRC) is an independent regulator in the UK and Ireland based in London Wall in the City of London, responsible for regulating auditors, accountants and actuaries, and setting the UK's Corporate Governance and Stewardship Codes. The FRC seeks to promote transparency and integrity in business by aiming its work at investors and others who rely on company reports, audits and high-quality risk management.
Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes. Internal auditing might achieve this goal by providing insight and recommendations based on analyses and assessments of data and business processes. With commitment to integrity and accountability, internal auditing provides value to governing bodies and senior management as an objective source of independent advice. Professionals called internal auditors are employed by organizations to perform the internal auditing activity.
Materiality is a concept or convention within auditing and accounting relating to the importance/significance of an amount, transaction, or discrepancy. The objective of an audit of financial statements is to enable the auditor to express an opinion on whether the financial statements are prepared, in all material respects, in conformity with an identified financial reporting framework, such as the Generally Accepted Accounting Principles (GAAP) which is the accounting standard adopted by the U.S. Securities and Exchange Commission (SEC).
The Institute of Chartered Accountants of Pakistan is a professional accountancy body in Pakistan. It has over 10,000 members working locally and globally. The institute was established on July 1, 1961 to regulate the profession of accountancy in Pakistan. It is a statutory autonomous body established under the Chartered Accountants Ordinance, 1961. With the significant growth in the profession, the CA Ordinance and By-Laws were revised in 1983.
The New Jersey State Auditor is a constitutional officer appointed by the New Jersey Legislature and administratively placed within the Office of Legislative Services. The Auditor conducts financial and performance audits of State agencies, certain school districts, and vicinages of the Judiciary. The State Auditor also conducts studies on the operation, economy and efficiency of State-run or State-supported programs.
State auditors are fiscal officers lodged in the executive or legislative branches of U.S. state governments who serve as external auditors, program evaluators, financial controllers, bookkeepers, or inspectors general of public funds. The office of state auditor may be a creature of the state constitution or one created by statutory law.
Auditor independence refers to the independence of the internal auditor or of the external auditor from parties that may have a financial interest in the business being audited. It ensures that auditors do not have any financial interest in the firms in which they are auditing.
The following outline is provided as an overview of and topical guide to accounting:
The Association of International Accountants (AIA) is a professional accountancy body. It was founded in the UK in 1928 and since that date has promoted the concept of ‘international accounting’ to create a global network of accountants in over 85 countries worldwide.
The Office of the Comptroller and Auditor General of Bangladesh (C&AG) is the Supreme Audit Institution (SAI) of the country. Like the SAIs in many other countries across the world the institution is established by the Constitution of Bangladesh. This institute is responsible for maintaining accounts of the republic and audits all receipts and expenditure of the Government of Bangladesh, including those of bodies and authorities substantially financed by the government. The reports of the CAG are discussed by the Public Accounts Committee, which is a standing committee in the Parliament of Bangladesh.
