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Introduction to Auditing, Auditor's Obligations, Auditor's Rights,…
Introduction to Auditing
Agency Theory
Accountability, Stewardship and Agency
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Auditor's Obligations
Adequate accounting records and returns
- Whether adequate accounting records have been kept and returns adequate for the audit received from branches not visited by the auditor.
Consistency of other information
- Whether the information in the directors' report is consistent with the financial statements.
Agreement of accounts to records
- Whether accounts are in agreement with accounting records.
Compliance with legislation
- Whether financial statements have been prepared in accordance with relevant legislation.
Directors' benefits
- Whether disclosure of directors' benefits has been made in accordance with the Companies Act.
Truth and fairness of accounts
- Whether statement of financial position statement of profit or loss and other comprehensive income show a true and fair view of the results.
Auditor's Rights
Right to be heard at general meeting
- A right to be heard at general meetings which they attend on any part of the business that concerns them as auditors.
Rights in relation to write resolutions
- A right to receive a copy of any written resolution proposed.
Information and explanation
- A right to require from the company’s officers such information and explanations as they think necessary for the performance of their duties as auditors
Access to records
- A right of access at all times to the books, accounts and vouchers of the company
Attendance at/notices of general meetings
- A right to attend any general meetings of the company and to receive all notices of and other communications relating to such meetings which any member of the company is entitled to received.
Agency Theory
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Agency
- They are people employed or used to provide a particular service
Accountability
- Obligation or willingness to accept responsibility for one's actions
Stewardship
- It refers to the duties and obligations of a person who manages another person's property
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