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Auditing and Audit Processes

Auditing10 CardsCreated 3 months ago

This deck covers key concepts related to auditing, including the roles and responsibilities of auditors, the audit process, and the legal requirements for audits as per the Companies Act and the Auditing Profession Act.

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What is the main difference between an audit and an audit review?

An audit provides full assurance, while an audit review provides moderate assurance.

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Key Terms

Term
Definition
What is the main difference between an audit and an audit review?
An audit provides full assurance, while an audit review provides moderate assurance.
Define 'auditor' as per the Auditing Profession Act 26 of 2005.
An auditor is an individual or firm registered with the Independent Regulatory Board for Auditors (IRBA).
Which companies are required by the Companies Act to have their financial statements audited?
Public companies, both listed and unlisted, and state-owned companies must have their financial statements audited.
What rights does an auditor have according to the Companies Act?
Auditors have the right to access company records, require information from directors, attend shareholder meetings, and apply for court orders to enfo...
Why does the Companies Act require the rotation of auditors?
To ensure independence and prevent conflicts of interest, auditors must rotate after a set period.
What is the role of an audit committee?
The audit committee nominates auditors, determines their fees, ensures compliance with laws, and oversees non-audit services.

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Auditing and Audit Processes
TermDefinition
What is the main difference between an audit and an audit review?
An audit provides full assurance, while an audit review provides moderate assurance.
Define 'auditor' as per the Auditing Profession Act 26 of 2005.
An auditor is an individual or firm registered with the Independent Regulatory Board for Auditors (IRBA).
Which companies are required by the Companies Act to have their financial statements audited?
Public companies, both listed and unlisted, and state-owned companies must have their financial statements audited.
What rights does an auditor have according to the Companies Act?
Auditors have the right to access company records, require information from directors, attend shareholder meetings, and apply for court orders to enforce these rights.
Why does the Companies Act require the rotation of auditors?
To ensure independence and prevent conflicts of interest, auditors must rotate after a set period.
What is the role of an audit committee?
The audit committee nominates auditors, determines their fees, ensures compliance with laws, and oversees non-audit services.
What is a reportable irregularity according to the Audit Profession Act?
A reportable irregularity is any unlawful act or omission committed by a company that could cause material financial loss.
What must an auditor do if they suspect a reportable irregularity?
The auditor must report it to the Regulatory Board and notify the company's management.
How long can an individual serve as an auditor for a company?
An individual may not serve as an auditor for more than 5 consecutive years.
What are the duties of a company secretary?
The company secretary advises directors, ensures compliance with laws, and maintains company records.