Question

. What do you understand by the term “Audit Report

Answer 1

The audit report is a written statement/report from the auditor expressing an opinion if the financial statements are in accordance with the applicable accounting and financial standards and Generally Accepted Accounting Principles. The auditor also reports any significant material information to the users of the report if such information was left out from the management or financial statements. The audit report is included as a part of annual report.

The audit report consists of three parts. First states the responsibilities of the Company - its directors and then, the auditor. Second paragraph is about the various set of standards of audit observed during the course of audit and its scope in the audit. The last part is the auditor's opinion with explanations. Further auditor can also annex an extra statement to inform the users on any other matters as a part of his audit report.