Auditor independence refers to the independence of internal or external auditor that may have the appropriate capabilities, competence, authority and time to perform their duties and responsibilities. Independence also requires the integrity, objectively, professional competence, confidentially and professional behavior to audit planning and audit process. To prepare of informative, accurate, and independent audit reports, the auditors of listed company are independent in order to protect the interests of investors.
The independent auditor must have the professional qualifications with the education and audit experiences. They should be straightforward and honest in professional audit process and business relationship. They should be express the recommendation for the truth and fairness of the financial statement, and comply with the guidelines, professional codes or standards issued by HKICPA, Hong Kong Stock Exchange and other professional or statutory bodies. They should have expertise in the accumulation of audit evidence, monitor and enhance the effectiveness of internal control. They should identify the area of weakness and inefficiencies or any possible of errors in its system of internal control, then they can provide the effective recommendation to increase the related area efficiency and facilitates the prevention and detection of errors
The fair presentation of financial statements is behaved in conformity with the guidelines, professional codes or professional standards that are an integral part of management’s responsibility. Based on the information is provided by the listed company, the independent auditor can make the recommendation for the content or draft of financial statement in whole or in part. The responsibility of the independent auditor is confined his professional audit opinion on the financial statements for a true and fair view.
Finally, an independent auditor can provide the independent audit that enhances the credibility to the financial statements of the listed company that giving confidence to the board, shareholders, bankers and investors etc.
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