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Generally Accepted Auditing Stndards

Generally Accepted Auditing Standards
Auditing is the “systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between those assertions and established criteria and communicating the results to interested users” (Boynton & Johnson, 2006, p. 6). With the rise in technology occurring daily, audits are important to the financial world. Relaying an entity’s financial condition with assurances from an auditor eases the users’ anxieties over the content of the financial statement. The functions of auditing, adhering to generally accepted auditing standards and how to apply those standards to financial, operational and compliance audits plays a significant role in audits of the financial condition of an entity.
Function of Auditing
The function of auditing is to verify the financial information of the entity relayed through the entity’s management reports. Therefore, the auditor oversees the manager’s activities within the entity. This is significant for the entity and the financial condition of the entity since verifying the information lends credibility to the financial statements provided to users. The International Brotherhood Electrical Workers Local Labor Union is audited yearly by a Certified Public Accountant in order to assure users of the company’s financial statements that the financial information provided is accurate and verifiable Also, the Labor Union is internally audited at various intervals throughout the year. The auditor must plan the audit in advance, stay independent of the entity being audited and acquire reliable evidence within the entity. To properly audit an entity, auditors must follow the generally accepted auditing standards.

Generally Accepted Auditing Standards
Generally accepted auditing standards (GAAS) are “a set of systematic guidelines used by auditors when conducting audits on companies' finances, ensuring the...