Chapter Review

Key Takeaways

• Auditing provides reasonable assurance on financial statements.
• Independent auditors increase the credibility of financial reporting.
• Management prepares the financial statements, while auditors express an opinion on them.
• Every audit follows a structured process from planning to reporting.
• Reasonable assurance is not the same as absolute assurance.
• Professional judgment and professional skepticism are fundamental auditing concepts.
• Financial statements are evaluated using an established reporting framework such as U.S. GAAP.

The objective of an audit is to express an independent opinion on whether financial statements are fairly presented, in all material respects.