What is the relationship between general audit objectives and specific audit objectives?

Chapter 66-13 Distinguish between the general audit objectives and management assertions.Why are the general audit objectives more useful to auditors?

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6-14 An acquisition of a fixed-asset repair by Construction Company is recorded onthe wrong date. Which transactions-related audit objective has been violated? Whichtransactions-related audit objective has been violated in the acquisition had beencapitalized as a fixed asset rather than expensed?

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6-15 Distinguish between the existence and completeness balance-related auditobjectives. State the effect on the financial statements (overstatement or

Chapter 6

Audit responsibility and objectives

6-1 (Objective 6-1) State the objective of the audit of financial statements. 

In general terms, how do auditors meet that objective? 

The objective of the audit of financial statements by the independent auditor 

is 

the 

expression 

of 

an 

opinion 

on 

the 

fairness 

with 

which 

the 

financial 

statements present financial position, results of operations, and cash flows in 

conformity with generally accepted accounting principles. 

The 

auditor 

meets 

that 

objective 

by 

accumulating 

sufficient 

appropriate 

evidence to determine whether the financial statements are fairly stated. 

6-2 

(Objectives 

6-2, 

6-

3) 

Distinguish 

between 

management’s

and 

the 

auditor’s responsibility for the financial

 statements being audited. 

It 

is 

management's 

responsibility 

to 

adopt 

sound 

accounting 

policies, 

maintain adequate internal control and make fair representations in the financial 

statements. The auditor's responsibility is to conduct an audit of the financial 

statements in accordance with auditing standards and report the findings of the 

audit in the auditor's report. 

6-3 (Objective 6-3) Distinguish between the terms errors and fraud. What 

is the auditor’

s responsibility for finding each? 

An error is an unintentional misstatement of the financial statements. Fraud 

represents intentional misstatements. The auditor is responsible for obtaining 

reasonable assurance that material misstatements in the financial statements 

are detected, whether those misstatements are due to errors or fraud

. 

An audit must be designed to provide reasonable assurance of detecting 

material misstatements in the financial statements. Further, the audit must be 

planned and performed with an 

attitude of professional skepticism 

in all aspects 

of 

the 

engagement. 

Because 

there 

is 

an 

attempt 

at 

concealment 

of 

fraud, 

material misstatements due to fraud are usually more difficult to uncover than 

errors. The auditor’s best defense when material

 misstatements (either errors 

or 

fraud) 

are 

not 

uncovered 

in 

the 

audit 

is 

that 

the 

audit 

was 

conducted 

in 

accordance with auditing standards. 

6-4 (Objective 6-3) Distinguish between fraudulent financial reporting and 

misappropriation of assets. Discuss the likely difference between these 

two types of fraud on the fair presentation of financial statements. 

Misappropriation 

of 

assets 

represents 

the 

theft 

of 

assets 

by 

employees. 

What is the relationship between audit objectives and audit procedures?

What are general audit objectives?

What is the relationship of audit objectives with management assertions?

Is a general audit objective more useful to the auditor than management assertions?