Concept Introduction:Auditing is an independent examination of financial statements. The set of financial statements includes balance sheet, income statement, statement of owner’s equity, and statement of cash flows. The audit is performed by an independent auditor.
To indicate:The difference in studying the audit as compared to accounting topics.
Auditing is one of the accounting concepts but its study is a bit different from other accounting concepts. Most of the accounting concepts have predefined rules and formulas, but auditing is based on judgment and practical approaches. In other words, auditing does not provide predefined solution for different situations like other accounting concepts do.
Consultants include auditor and related service providers of the business. Consultants need to understand auditing concepts as they provide such services. Managers and other decision makers are directly affected by the auditing results and reports, hence it is better for them to understand the auditing concepts.