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Introduction to Auditing
Rating: 4.7 out of 5(8 ratings)
120 students

Introduction to Auditing

Audit helps in keeping a company in check and ensuring its ethical conduct of business.
Created byManagement Study Guide
Last updated 9/2018
English
English [Auto],

What you'll learn

  • Explain What is Auditing
  • Explain Purpose of Auditing
  • Describe the Types of Audits
  • Explain Key Features of Auditing
  • Explain Principles of Auditing
  • Describe the Role of Government in Auditing
  • Describe the Role of Independent Directors in Auditing
  • Explain Strategy for Stringent Auditing
  • Explain Challenges of Auditing and Auditors
  • Explain Best Practices of Auditing

Course content

1 section • 11 lectures • 41m total length

  • Introduction4:33

    Explore the fundamentals of auditing, its purpose and types, through a case where a company's exaggerated profits are exposed by an external audit, highlighting ethics, governance, and best practices.

  • Explain What is Auditing1:19

    Auditing involves assessing financial, operational, and strategic processes to verify regulatory conformance and alignment with organizational goals, reflecting a healthy culture in the public image.

  • Explain Purpose of Auditing0:54

    Explore the purpose of auditing by highlighting its roles in improving efficiency, promoting globalization, ensuring transparency for strong economic development, safeguarding shareholders’ rights, and supporting social and institutional scope.

  • Describe the Types of Audits7:12

    Identify audit types, internal, external, financial, strategic, operational, and IT, and explain how they ensure regulatory compliance, governance, and financial accuracy under Sarbanes-Oxley certification by CEOs and CFOs.

  • Explain Key Features of Auditing6:52

    Explore the key features of auditing—holistic approach, transparency, legal personality, and responsibility toward society—and how they foster investor confidence and ethical, transparent reporting.

  • Explain Principles of Auditing5:28

    Explore core auditing principles, ethics, and stakeholder accountability, and how independence safeguards integrity amid corporate governance. Learn how audits, certifiers, and consultants shape transparency, cooperation, and economic growth.

  • Describe the Role of Government in Auditing2:21

    Regulate corporations to deter corporate and white-collar crime and protect shareholders and investors. Enforce criminal sanctions, establish ethics standards, and ensure whistleblower protections with clear accountability for individuals and boards.

  • Describe the Role of Independent Directors in Auditing6:48

    Explore how independent directors, as regulators expect, enhance auditing and governance by providing objective oversight, promoting transparency and accountability, and deterring fraud through external audits and reporting.

  • Explain Strategy for Stringent Auditing1:13

    Apply a stringent auditing strategy that recognizes tangled corporate relationships, enforces periodic auditor rotation, and relies on regulator oversight and internal ethical norms to prevent fraud.

  • Explain Challenges of Auditing and Auditors1:17

    Auditing faces serious challenges as audits may conceal internal deficiencies, with concerns about auditor collusion and reduced independence; regulators tightened controls after laws like Sarbanes-Oxley.

  • Explain Best Practices of Auditing3:38

    Explore best practices of auditing to promote transparency and accountability under stricter regulatory requirements. Learn how ethical, transparent reporting and fair business practices support compliance for banks, corporations, and stakeholders.

Requirements

  • No prior knowledge is necessary.

Description

Auditing is the process of assessment and ascertaining of financial, operational, and strategic goals and processes in organizations. Audit helps to determine whether they are in compliance with the stated principles in addition to them being in conformity with organizational and more importantly, regulatory requirements. Indeed, among the objectives of auditing as mentioned above, conformance with regulatory norms and rules and regulations is indeed one of the drivers behind auditing.

Historically and traditionally, conforming with regulatory norms, rules and regulations, has been the main reason why organizations get their financial statements, operational process, and strategic imperatives audited. The culture of a corporate will always be accurately reflected by the public image of a corporation. Therefore, it is very important that good auditing practice should run in the bloodstream of the organization since this in turn will be reflected in the culture. So, an organization whose internal functions are healthy will naturally look healthy from an external perspective.

There is a need for auditors, certifiers, and consultants to be ethical in their dealings with corporates. As was seen in the way the American Energy behemoth Enron collapsed as it was found to be fudging its accounts and indulging in corrupt practices, the main reason that was found was that the auditors and consultants, Arthur Anderson, were in glove with the Enron top management in hoodwinking the regulators and the investor community. Further, the cases of WorldCom, Lehmann Brothers, and Satyam computers in India were examples of corporates that colluded with their auditors, certifiers, and consultants in an attempt to indulge in fraud and get away with it. These examples show us that extreme caution and care have to be exercised by these entities when they deal with the corporates and they must preserve their integrity and independence at all costs.

The point here is that these entities are professionally and by law tasked with the responsibility of protecting stakeholder interests and hence, they must not compromise and betray the faith and trust that is placed on them. It would suffice to state here that there is a fine balance between providing professional advice and auditing the statements in a fair and equitable manner and crossing the line to be conspiring with the corrupt in the corporate world.

Who this course is for:

  • This course is good for management learners and people who want to learn about Introduction to Auditing

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