Financial Statement Audit
It is conducted to determine whether the overall financial statements (the information being verified) are stated in accordance with specified criteria that are the principles set out in the accounting standards. The financial statements covers the audit on Statement of Financial Position, Statement of Comprehensive Income, Statement of Cash Flow and Notes to accounts. Example: Annual audit of XYZ financial statements. Information: XYZ financial statements. Established Criteria: Generally accepted accounting principles. Available Evidence: Documents, records, and outside sources of evidence. Operational Audit
It evaluates the efficiency of any part of an organisation’s operating procedures and methods. The purpose of an operational audit is to assess performance, identify areas of improvement and develop recommendations. At the end of the operational audit, recommendations to management for improving operations are normally expected. An example is evaluating the efficiency and accuracy of processing payroll transactions in a newly installed computer system. Compliance Audit
It is to determine whether the auditee is following specific procedures, rules or regulation set down by some higher authority. Results of compliance audit are typically reported to someone within the organizational unit being audited rather than to a broad spectrum of users, management is the primary group. An example is auditing of a government agency by the Auditor General for compliance with the relevant statutory requirements. Forensic Audit
It is a special investigation audit that mainly focuses on fraud, criminal cases, shareholders dispute or negligence. It requires the use of critical analyses and investigative skills, integrated with accounting knowledge and business experience.
Types of Auditors
They are employed by individual companies to audit for management. They reports to the chairman, or the audit committee...