Auditing

Introduction

Audit plays a very important role in serving the interest of organizations and people in general. It strengthens the accountability and reinforces trust and confidence in financial reporting. It also maintains a check on the performance of managers, who can exploit the resources of the firm using their skill. Scandals like Enron and WorldCom in the U.S. or Parmalat in Europe have increased the significance of Auditing. It is now imperative for organizations and managers to comply with accounting principles and regulations in order to avoid such scandals in future (Barber & Odean, p.31). IAA has developed a code of ethics for the auditors, which contains five basic principles of conducting an audit. However, auditing tends to play a very vital role when it comes to grants whether provincial or federal in nature. Thus, in the context of the paper we intend to shed light on the criteria to get federal grants. As the federal grants tends to be significant in order for a project which needs the financial backing.

Discussion

The foremost criteria for a federal grant is the fact that the organization applying for the federal grant should be have an efficient audit system. It tends to inculcate the objectivity, lack of conflict of interest, due diligence, lack of prejudice and professional secrecy. Auditing is a tool used for collecting data for decision making and the future activities of the organization. The auditors should thoroughly investigate and analyze every problem from many angles, using interviews and employee reviews. The areas that may require enhanced audit work includes, Assessments at fair value, Impairments that are not temporary, Credit derivatives, Pensions and other post-employment, Claims, Stocks, Impairment of other assets, Deferred taxes and Disclosures. Secondly the criteria for a federal grant tends to be the application and way it is approached especially ...