An auditor is an independently
qualified person who is appointed to give shareholders an independent,
professional and informed opinion on the financial statements prepared by the
directors. An audit can also be of benefit to third parties wishing to engage
in business with the company as it helps to assess the reliability of the
information provided.
Provide An Audit Report
The main responsibility of an
auditor is to report to the members. The report must state whether, in the
opinion of the auditor, the financial statements give a true and fair view of
the state of the company’s affairs and whether they have been prepared in
accordance with relevant provisions of the Companies Acts and other relevant
legislation and accounting standards.
The auditors’ report must be
made available to every member and be read at the AGM.
If the auditor cannot give a
positive opinion, they may give:
·
A qualified opinion –
this states that the financial statements give a true and fair view of the
company’s state of affairs except for certain stated circumstances;
·
A disclaimer of opinion– this
states that the auditor is unable to form an opinion as they were unable to
gather a sufficient amount of competent evidence; and
·
An adverse opinion – this
states that the financial statements do not give a true and fair view.
Report Failure To Maintain Proper Books Of Account
If an auditor discovers that a
company has not kept proper books of account, they must notify the company of
this opinion. If the directors do not take the necessary steps to correct this
situation within seven days, auditors must notify the Companies
Registration Office of their opinion.
Duty To Report Indictable Offences
If auditors discover
information during an audit that leads them to believe that the company or
anyone associated with it has committed an indictable offence under the
Companies Acts, they must report this to the Office
of the Director of Corporate Enforcement (“ODCE”)
and help the ODCE with their investigation of the report.
Auditors’ Responsibilities
The auditor’s responsibility
is to express an opinion on whether management has fairly presented the information
in the financial statements. To do so, the auditor collects evidence to obtain
reasonable assurance that the accounts are free of material misstatement.
by cindy
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