Question

Provide an example of an uncertainty that exists in the auditing profession and explain why you think it is an uncertainty. DON'T COPY & PASTE from any websites

Answer 1

Example of uncertainty that exists in the auditing profession is Existence of Fraud in the organisation. This is one of the major uncertain event which can occur in the entity. This role of auditor is to give true and fair view of the financial statements not to search for fraud in the entity. The role of auditing is to gain sufficient audit evidence to support the fact whether the statement are free from mis statements. Detection of fraud is altogether different. Since fraud are coated in different layers by the internal management/ employees only to it is very hard to detect that whether fraud has incurred in the organisation or not. This makes this event uncertain of it's occurance.

More examples of uncertain events can be :-

Litigation and claims against the organisation

Non compliance of laws