Over the period, there has been significant progress in financial audit, which has led to perfection. The financial audit has been present in various forms through this progress, mostly from the objectives point of view. At the beginning of the century, the primary objective of auditing was to detect and prevent fraud (Lessambo, 2018). The audit work focused on the balance sheet since the income statement was perceived as a highly confidential document, not publicly disclosed.
However, in the modern world, the primary objective of auditing is to create a fairness opinion of financial statements and how they conform to the generally accepted accounting principles. Professional standards also require the audit to be developed to provide rational assurance of detecting misstatements of materials due to fraud or errors. The audit places a particular emphasis on the income statement since it is of great significance to investors. Additionally, auditing in the current world has the objective of meeting the Securities and Exchange Commission (SEC) requirements (Lessambo, 2018). Likewise, auditing has a goal to meet the requirements for Public Company Accounting Oversight Board for public companies.
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AICPA Contributions to Auditing Literature That Shaped the Current Auditing Objectives
Statements on Auditing Standards are one of the AICPA contributions to auditing literature. These statements guide external auditors on the generally accepted standards (GAAS) concerning a non-public company auditing and report issuing (Whittington & Pany, 2019).
Statements on Standards for Attestation Engagements are another contribution to auditing literature by the AICPA. They address activities undertaken by a service auditor to give feedback on service organizations' regulations, which offer services to user entities. The controls of a service organization should be relevant to user entities' internal control over financial reporting (Whittington & Pany, 2019). A service firm refers to any entity that offers services to another firm.
References
Lessambo, F. I. (2018). Overview, history, and overall objectives of auditing. Auditing, Assurance Services, and Forensics , 3-16. https://doi.org/10.1007/978-3-319-90521-1_1
Whittington, R., & Pany, K. (2019). Principles of auditing and other assurance services with Connect (21st ed.). McGraw-Hill Education. ISBN-13: 9781260574777
