ACCOUNTING THEORY

Auditing Assignment

Auditing Assignment

Introduction

The process in which the systematic examination as well as evaluation of the quality system of the audit is being carried out is termed as quality audit. The audit might have been carried out by an auditor who is either independent or an auditor who is the part of the quality auditor team. When one talks about the overall quality management system that prevails in an organization, quality audit is one of the key components of this system. It is a key element of the overall quality system.

These audits are being performed at time intervals that are predefined in their nature. There must be some sort of assurance when these audits are completed that the internal system is functioning well and there all the processes are linked to effective action. When determining the quality of the audit, there are two things that are really necessary, first thing is that is must make sure that the quality of the audit has been acknowledged and looked at and the overall importance of the quality and the outcomes have been kept in mind. The quality processes of the organization are also needed to be looked at as they are really important when delivering quality outcomes. Thus there are input based quality indicators and there are output based quality indicators that company has to look at.

Input Based Quality

Input Based Quality indicators can help the organization to determine the extent to which the processes are meeting the criteria's. These criteria's work more or less in the same manner as they way quality control are important for the medicine shop (Richard, 2006, p.153). These are important as far as gauging the internal processes of the organization, then there are internal based indicators that determine that what is the value that user is getting from the processes. When these two factors are being looked and they are taken into the consideration, only then one is in the position to define what audit quality should be.

Formal Definition of Audit Quality

Audit Quality has been termed as the role of the committee in over sighting and try to determine how the confidence can be increased in some of the financial statements. It also makes sure that there is due compliance with the regulations whether they are output based indicators or input based indicators. They also keep into consideration the auditors role in the quality control system. Standards that are set by professional are also needed to be looked at. Audit quality also seems to provide definite connection and link in the essential constituents of the framework of audit quality control. There are some other professional standards that are needed to be looked as well as considerations of the ethics, knowledge, attitude and execution (Lee & Stone, 1995, p.1169).

Mentioned above are some of the major elements of the definition and essential of Audit Quality. These standards and essential are set as per PCAOB's Standing Advisory Group (SAG).

PCAOB's Standing Advisory Group (SAG) also emphasizes that ...