Today the business world has expanded its empire and captured the whole world. Without the growth of business the economy will cease to exist. This growth is only possible in a protected environment where the business can grow without the fear and anxiety of corruption and dishonesty. This required atmosphere can only be provided by proper audit. The auditor in charge of this auditing determines how far the business world can grow. A dishonest and corrupted auditor can be the one responsible for the downfall and even bankruptcy of a business giant. Moreover the consequences of audit failure can be devastating. It can not only bankrupt the company but also harm the entire system. That is why we can say that honesty, integrity and dedicated professionalism is the cry of the business world. Auditor's task is to ensure reliability of information and assessment of internal control of organization. The auditor also expresses opinion on the person or organization or system in question under evaluation based on work done on a test basis. Traditionally, audits were mainly associated with gaining information about financial systems and the financial records of a company or a business. However, recent auditing has begun to include other information about the system such as information about environmental performance. As a result there are now professions conducting environmental audits.
In financial audit, the accounts and financial statements are checked for misstatements and reported about their truthfulness. Today audit is broadening to different sectors from its traditional type to environment audit, tax audit etc.
An external auditor is free of any influence and so judges the information produced by management independently. To make the report worthy of belief, the auditor must be highly educated, proficient, competent and objective person.
An auditor determines the quality of financial and operational control by examining and evaluating records, systems, procedures, operations, activities of organization through analytical reviews and comparisons. Through interpretation of significant ratios, an auditor can find firm's strength and weakness and where to emphasize to detect and prevent fraud to make his workless critical, he first examines the operation system and control of organization. More efficient internal control system makes the work effective as there would be less chance of fraud. The analytical review steps for forming an overall conclusion about the consistency of financial information as a whole with the knowledge of the entity’s business and relevant economic conditions is also performed by the auditor. Thus the system of analytical review adopted generally in combinations of other method have in major cases yielded the desired results enabling the auditor to present a good audit report.
The qualities that the auditor should possess as its professional requirement are as follows: ➢ Integrity - An auditor should be straightforward, honest and sincere in his approach to his professional work.
➢ Objectivity - An auditor should be fair and should not allow prejudice or bias to override his objectivity. While on financial statements which come under his review, he should maintain an impartial attitude.
➢ Independence - When in public practice, an auditor should behold and appear to be free of any interest which might be regarded whatever be it actual effects as being incompatible with integrity and objectivity.
➢ Confidentiality - An auditor should respect the confidentiality of information’s required in the course of his work and should not disclose any such information to a third party without a specific authority or unless there is legal or professional compulsion to disclose. The breach would change him for guilty of misfeasance.
➢ Technical standard – An auditor should carry out his professional work in accordance with the...