SA 200”OVERALL OBJECTIVE OF THE INDEPENDENT AUDITOR AND CONDUCT OF AUDIT

• SA 200”OVERALL OBJECTIVE OF THE INDEPENDENT AUDITOR AND CONDUCT OF AUDIT
  CONTEMPORARY AUDITING
  AUDITING AND ASSURANCE
• SA 200” OVERALL OBJECTIVE OF THE INDEPENDENT AUDITOR
• OVERALL OBJECTIVES OF THE AUDITORS

1. TO OBTAIN REASONABLE ASSURANCE ABOUT WHETHER THE FINANCIAL STATEMENTS AS A WHOLE ARE FREE FROM MATERIAL MISSTATEMENT,WHETHER DUE TO FRAUD OR ERRORS THEREBY ENABLING AUDITOR TO EXPRESS AN OPINION THAT THESE ARE PREPARED WITH AN APPLICABLE REQUIREMENTS
2. TO REPORT AND COMMUNICATE AS REQUIRED BY THE SAS IN ACCORDANCE WITH THE AUDITOR’S FINDING
3. IN ALL CASES WHEN REASONABLE ASSURANCE CAN NOT BE OBTAINED AND A QUALIFIED OPINION IN THE AUDITOR’S REPORT IS INSUFFICIENT,THE SA REQUIRE THAT DISCLAIM AN OPINION OR WITHDRAW FROM THE ENGAGEMENT

• REQUIRMENTS OF STANDARD
• ETHICAL REQUIREMENTS RELATING TO AN AUDIT OF FINANCIAL STATEMENT
• SHALL COMPLY WITH THE RELEVANT ETHICAL REQUIREMENTS INCLUDING INDEPENDENCE
• MEANS CODE OF ETHICS ISSUED BY THE ICAI. THE FUNDAMENTAL PRINCIPLE ARE :

1. INTEGRITY
2. OBJECTIVITY
3. PROFESSIONAL COMPETENCE AND DUE CARE
4. PROFESSIONAL BEHAVIOR

• INDEPENDENCE COMPRISE BOTH INDEPENDENCE OF MIND AND INDEPENDENCE OF APPEARANCE
• INDEPENDENCE ENHANCES THE AUDITOR’S ABILITY TO ACT WITH INTEGRITY TO BE OBJECTIVE AND TO MAINTAIN AN ATTITUDE OF PROFESSIONAL SKEPTICISM
• PROFESSIONAL SKEPTICISM
• MEANS : AN ATTITUDE THAT INCLUDE :
• A QUESTIONING MIND,BEING ALERT TO CONDITIONS WHICH MAY INDICATE
• POSSIBLE MISSTATEMENT DUE TO ERROR AND FRAUD
• A CRITICAL ASSESSMENT OF AUDIT EVIDENCE

·         REQUIRMENTS:

1. PLAN AND PERFORM AN AUDIT WITH PROFESSIONAL SKEPTICISM
2. REDUCES THE RISK OF IGNORING UNUSUAL CIRCUMSTANCES,OVERGENERALIZING AND USING INAPPROPRIATE ASSUMPTIONS
3. PROFESSIONAL SKEPTICISM INCLUDES BEING ALERT TO

1. CONTRADICTORY AUDIT EVIDENCE
2. QUESTION ON RELIABILITY OF DOCUMENTS
3. CONDITIONS INDICATING POSSIBLE FRAUDS
4. CIRCUMSTANCES SUGGESTING NEED FOR AUDIT PROCEDURES IN ADDITIONS TO THOSE SUGGESTED IN SAS

• MEANING OF PROFESSIONAL JUDGMENT:-

1. THE APPLICATION OF RELEVANT TRAINING AND KNOWLEDGE AND EXPERIENCE
2. WITHIN THE CONTEXT PROVIDE BY AUDITING ACCOUNTING AND ETHICAL STANDARDS
3. IN MAKING INFORMED DECISIONS ABOUT THE COURSES OF ACTIONS
4. THAT ARE APPORPRIATE IN THE CIRCUMSTANCES OF THE AUDIT ENGAGEMENT

• REQUIRMENTS OF PROFESSIONAL JUDGMENT

1. SHALL EXERCISE PROFESSIONAL JUDGMENT IN PLANNING AND PERFORMING AN AUDIT OF FINANCIAL STATEMENTS
2. ITS EXERCISE DEPENDS ON FACTS AND CIRCUMSTANCES KNOWN TO THE AUDITOR
3. TO BE EXERCISED THROUGHOUT THE AUDIT AND TO BE APPROPRIATELY DOCUMENTED
4. PROFESSIONAL JUDGMENT IS IMPORTANT WHEN DECIDING UPON :

1. MATERIALITY AND AUDIT RISK
2. NTE OF AUDIT PROCEDURES
3. EVALUATING SUFFICIENCY AND APPROPRIATENESS OF AUDIT PROCEDURES
4. EVALUATING JUDGMENT
5. DRAWING CONCLUSIONS BASED ON AUDIT EVIDENCE

6. SUFFICIENT APPROPRIATE AUDIT EVIDENCE AND AUDIT RISK:-
7. TO OBTAIN REASONABLE ASSURANCE THE AUDITOR SHALL OBTAIN SUFFICIENT APPROPRIATE AUDIT EVIDENCE:-

1. TO REDUCE AUDIT RISK TO BE ACCEPTABLE TO LOW LEVEL
2. ENABLING THE AUDITOR TO DRAW REASONABLE CONCLUSIONS ON WHICH TO BASE THE AUDITOR’S OPINION
3. REASONABLE ASSURANCE R HIGH BUT NOT ABSOLUTE LEVEL OF ASSURANCE
4. SUFFICIENT APPROPRIATE AUDIT EVIDENCE

·         AUDIT RISK:- THE RISK THAT THE AUDITOR EXPRESSES AN INAPPROPRIATE AUDIT OPINION WHEN THE FINANCIAL STATEMENTS ARE MATERIALLY MISSTATED. IT IS THE FUNCTION OF THE RISK OF MATERIAL MISSTATEMENT AND DETECTION RISK

• CONDUCT OF AUDIT IN ACCORDANCE WITH SAS
• COMPLIANCE WITH SAS RELEVENT TO AUDIT:-

1. COMPLY WITH ALL SAS RELEVANT TO THE AUDIT
2. RELEVANT TO THE AUDIT WHEN THE SA IS IN EFFECT AND CIRCUMSTANCES ADDRESSED BY THE SA EXIST
3. THE AUDITOR SHALL HAVE AN UNDERSTANDING OF THE ENTIRE TEXT OF AN SA

• THE AUDITOR SHOUL REPRESENT COMPLIANCE WHEN HE HAS COMPLIED WITH THE CONDUCT OF AUDIT IN ACCORDANCE WITH SAS

• OBJECTIVES STATES IN INDIVIDUAL SAS:

1. USE THIS OBJECTIVE TO ACHIEVE OVERALL OBJECTIVES
2. HAVING REGARD TO INTERRELATIONSHIP BETWEEN SAS:

1. DETERMINE OF ANY AUDIT PROCEDURE IN ADDITION TO THAT REQUIRED BY SAS IF NECESSARY
2. EVALUATE WHETHER SUFFICIENT APPROPRIATE AUDIT EVIDENCE HAS BEEN OBTAINED

• COMLYING WITH RELEVENT REQUIRMENTS UNLESS

1. ENTIRE SA IS NOT RELEVANT
2. REQUIREMENT IS NOT RELEVANT
3. DEPARTURE FROM REQUIREMENT IN EXCEPTIONAL CIRCUMSTANCES

·         FAILURE TO ACHIEVE AN OBJECTIVE:- EVALUATE IF THE FAILURE :

1. PREVENTS AUDITOR FROM ACHIEVING THE OVERALL OBJECTIVES OF THE AUDITOR
2. AND NECESSITATES MODIFIED AUDIT OPINION OR
3. WITHDRAW FROM THE ENGAGEMENT

4.     IT IS A SIGNIFICANT MATTER FOR DOCUMENTATION