Gaas Paper - Week 1

Generally Accepted Auditing Standards (GAAS)
Trudy Linden-Craft
April 7, 2014
Alisa Dumond

Auditing is an important process that companies must conduct to ensure its financial statements are organized and convene compliance with Generally Accepted Auditing Standards (GAAS) and other governmental agencies’ guidelines. In accounting, the purpose of an audit is objectively to obtain and evaluate data financial statements to establish the validity for presentation to concerned users. The auditing process consists of gathering, validating, and reporting company financial data. The topics discussed in this paper will provide details regarding the purpose and functions of auditing, the key elements of the GAAS standards, and relation of company standards as it pertain to operational, financial, and compliance audits. In addition, the audit effects of the Sarbanes-Oxley Act of 2002 (SOX) and the Public Company Accounting Oversight Board (PCAOB) will be discussed as well as the extra requirements of auditors established by both organizations.  

Generally Accepted Auditing Standards (GAAS)
Generally Accepted Auditing Standards (GAAS) is a set of principles consisting of 10 different standards that auditors use to conduct audits on companies’ financial records, ensuring consistency, accuracy, and certifiable actions and reports set forth by the AICPA. The GAAS standards are categorized into three sections: General Standards, Standards of Field Work, and Standards of Reporting and auditors must exercise professional judgment when applying them (AIPCA, 2014).
The first set of standards are the general standards an auditor uses effectively to perform companies’ financial, operational, and compliance audits; therefore, auditors are to remain independent of the client whose financial records they are auditing. Auditors must also express proficiency in accounting and auditing as well as express professional due care. The second set of standards is...