+1 (208) 254-6996 [email protected]

read the slides then answer the questions if  it’s qualified or unqualified for auditing 


Don't use plagiarized sources. Get Your Custom Essay on
Accounting Mini Assignment
Just from $13/Page
Order Essay



Audit Report: Meaning, Audit Report Vs. Audit Certificate, Purpose or Objectives of Audit Report, Qualities of Audit Report, Types of Audit Report, Contents of Audit Report. Generally Accepted Auditing Standards: General Standards, Standards of Field Work, Reporting Standards, Legal liability. Legal Liability


Report are essential to audit and assurance engagements because they communicate the auditor’s findings.

Audit Report provide assurance and rely on company’s financial statements

The auditor report is the final step in the entire audit process.

Audit report is common term is the expression of opinion by an independent third party (Auditor) as to compliance and fairness of a set of financial statements of a company.

Auditor’s Report is the means by which the auditors formally communicate the scope and the results of their audit to the members of the company as well as to the readers of the financial statements on which they are reporting.

Format of the Audit Report?

– An Audit Report is a report describing the financial condition and internal accounting controls by an independent auditor. The report is consumed by the stakeholders of the organization like the board of directors, shareholders, investors to name a few. The auditor must be careful and unbiased while preparing the report. It is the responsibility of the Auditor to prepare this audit report in the standardized format every year after reviewing the financial statements of the organization.

– Investors tend to rely on the auditor’s report before investing in any company. The Audit Report provides a clear picture of the financial health of the company without having to analyze the reports on your own. The report gives a reliable summary of an organization’s financial health.


An auditor’s report is not a certificate of accuracy of accounts or financial statements. It would be necessary, therefore, to maintain a clear distinction between a report and a certificate. This difference can be placed in the following manner

1 – AR is an expression of opinion on the financial statements of a Company.

– AC is vouch safes the truth a the statement company.

2. – AR is based on an examination of relevant records. Audit is only a test, and not a guarantee.

– AC is a guarantee of absolute correctness and accuracy.

3 – AR It states that the Profit and Loss Account and the Balance Sheet represent a true and fair view of the state of affairs of the business.

– AC Signing of a wrong certificate implies corresponding liability.

– AR The auditors can not be held responsible for accuracy, because their report is simply an opinion on the working results of the company.

– Auditors are not required to certify the accounts.

Purpose or Objectives OF AUDIT REPORT

(1) Facts : Auditors spend anywhere from a few days to a few weeks conducting audits on financial information, depending on the size of the company. At the end of each audit, a report is prepared indicating the findings of the audit.

(2) Types: Two types of audit reports are used in the accounting profession: qualified and non-qualified. A qualified audit opinion indicates auditors found significant accounting errors; a non-qualified opinion means there were no issues, and all accounting standards were properly observed by the company.

(3) Features: Qualified audit opinions may contain disclaimers. A disclaimer of opinion is issued when the auditor is unable to form an opinion on a business’s financial statements. Disclaimers may note a lack of auditor independence, a material scope limitation exists, or a significant uncertainty exists.

(4) Warning : Qualified audit opinions reflect negatively on the company, limiting opportunities for outside investment by individuals and banks. Failure to correct issues in the audit may cause the auditors to drop the company as a client.

(5) Expert Insight : The American Institute of Certified Public Accountants (AICPA) provides information for companies and auditors regarding the audit process and how Generally Accepted Accounting Principles (GAAP) should be applied in financial transactions.

An audit is an external review of a company’s financial information. It provides external stakeholders with an objective opinion of the company’s financial health, and how well the company follows standard accounting rules.


There are four types of audit reports.

Unqualified Opinion : It is often called a Clean Opinion. The audit report that is issued when an auditor determines that each of the financial records provided by the business is free of any misrepresentations. In addition, an unqualified opinion indicates that the financial records have been maintained in accordance with the standards known as Generally Accepted Accounting Principles (GAAP). This is the best type of report a business can receive.

Qualified Opinion : Such kind of report issue by an auditor when a company’s financial records have not been maintained in accordance with GAAP but no misrepresentations are identified, an auditor will issue a qualified opinion. The writing of a qualified opinion is extremely similar to that of an unqualified opinion. A qualified opinion, however, will include an additional paragraph that highlights the reason why the audit report is not unqualified.

Adverse Opinion : The worst type of financial report that can be issued to a business is an adverse opinion. This indicates that the firm’s financial records do not conform to GAAP. In addition, the financial records provided by the business have been grossly misrepresented. Although this may occur by error, it is often an indication of fraud. When this type of report is issued, a company must correct its financial statement and have it re-audited, as investors, lenders and other requesting parties will generally not accept it.

Disclaimer of Opinion: On some occasions, an auditor is unable to complete an accurate audit report. This may occur for a variety of reasons, such as an absence of appropriate financial records. When this happens, the auditor issues a disclaimer of opinion, stating that an opinion of the firm’s financial status could not be determined.

The standard unqualified audit report is issued when

the following conditions have been met:

1. All statements – balance sheet, income statement, statement of

retained earnings, and statement of cash flows – are included in the

financial statements.

2. The three general standards have been followed in all respects on the

engagement. (General, FW, Reptg.)

Continued on next slide


3. Sufficient evidence has been accumulated to conclude that the three

standards of field work have been met – “audit documentation”

4. The financial statements are presented in accordance with generally

accepted accounting principles.

5. There are no circumstances requiring the addition of an explanatory

paragraph or modification of the wording of the report.


A good report from the auditors should normally have the following qualities:

Factual information

Effective presentation

Independent and unbiased approach

Honest identification of weaknesses in control

Positive outlook, balanced criticism and logical suggestions

Precise, brief and relevant

Qualities of AUDIT REPORT

Parts of the Standard Unqualified Audit Report

1. Report title

2. Audit report address

3. Introductory paragraph

4. Management’s Responsibility

5. Auditor’s Responsibility

6. Opinion Paragraph

7. Name and Address of CPA firm

8. Audit report date

Title should include the word independent (e.g., independent audit report)

Report is usually addressed to the company, its stockholders or board of directors.

The intro paragraph does 3 things:

1. States the CPA firm has done an audit

2. It lists the financial statements that were audited

3. It defines responsibilities between management and the auditor

The scope paragraph is a factual statement about what the auditor did in the audit and sets the expectation about reasonable assurance.

The opinion paragraph states the auditor’s conclusions.

The name identifies the CPA firm who performed the audit.

The report date indicates the last day audit procedures were performed in the field.

FIGURE 3-1 Standard Unqualified Report on

Comparative Statements

Independent auditor’s Report

To the Stockholders

General Ring corporation

We have audited the accompanying balance sheets of General Ring Corporation as of December 31, 1999 and 1998, and the related statements of income, retained earnings, and cash flows for the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the evidence supporting the amounts and disclosures in the financial statements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of General Ring Corporation as of December 31, 1999 and 1998 and the results of its operations and its cash flows for the years then ended in conformity with generally accepted accounting principles.


March 5, 2000

Report Title

Audit Report




(factual Statement)

Scope Paragraph

(Factual Statement)

Opinion Paragraph


Name of CPA Firm)

Audit Report Date

(Date Audit Field

Work is completed)


Certified Public Accountants

Suite 100

Park Plazza East

Denver, Colorado 80110




1. Title: The title should mention – ‘Independent Auditor’s Report’.

2. Scope: The addressee should mention as to whom the report is being presented.

3. Introductory Paragraph:A statement that the financial statements described in the report have been audited.

4 Management’s responsibility for the financial statements: This section of audit reports format should mention the Management’s Responsibility to the integrity of the financial statements which gives an overview of the financial condition, cash flows of the Company and financial performance. The responsibility also includes the maintenance of accounting records to prevent frauds. It is their responsibility to formulate and execute necessary financial controls to ensure the accuracy of the financial records. It should mention that the financial statements are the responsibility of the organization’s management.


Auditors Responsibility: The Auditor responsibility is mentioned to depict an unbiased opinion on the financial statements and issue an audit report. The report is based upon Standards on Auditing. The Standards require that the auditor complies with ethical requirements. It is the auditor’s responsibility to plan and execute the audit to procure assurance regarding the financial statements.

Auditor’s Opinion : The most important content in an Audit Report is the Auditor’s Opinion. This mentions the impression derived after auditing the financial statements

Basis of Opinion: The basis on which the opinion has been achieved as reported. Facts of the basis should be mentioned.

Others Reporting Responsibilities.

Auditors Signature

Date of the Auditor’s Report

Sample of Audit Report:

Example Of An Unqualified Audit Report


Unqualified Opinion

(For an Organization)


Introductory Paragraph

We have audited the accompanying [indicate names of each financial statement] of the XYZ Company as of December 31, 20XX [indicate any other additional years necessary] for the year(s) then ended. These financial statements are the responsibility of [identify Borrower]. Our responsibility is to express an opinion on these financial statements based on our audit.

Scope Paragraph

We conducted our audit in accordance with International Standards on Auditing. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

Opinion Paragraph

In our opinion, the financial statements give a true and fair view of the financial position of the XYZ Company as of December 31, 19XX, and of the results of its operations and its cash flows for the year then ended in accordance with [indicate International Accounting Standards or relevant national standards].

[Name and Address of Audit Firm]

[Date – Completion Date of Audit]

The auditor’s report should be appropriately addressed as required by the circumstances of the engagement and local regulations..140 ANNEX XX


Understand the controversial environment in which CPAs practice.

Changed Legal Environment

Audit professionals have a responsibility under

common law to fulfill implied or expressed

contracts with clients.

They are liable to their clients for negligence

and/or breach of contract should they fail to

provide the services or not exercise due care

in their performance.


CPA Liability

Common Law

Develops through case decisions

Generally arising due to

Breach of contract,



Statutory liability

Develops when governmental unit passes laws and regulations imposing liability on CPAs

Business Failure, Audit Failure, and Audit Risk







Business Failure, Audit Failure, and Audit Risk

Business failure

It occurs when a business is unable to

repay its lenders or meet the

expectations of its investors because

of economic or business conditions.

Business Failure, Audit Failure, and Audit Risk

Audit failure

It occurs when the auditor issues an

Wrong audit opinion as the result

of an underlying failure to comply

with the requirements of generally

accepted auditing standards (GAAS).

Business Failure, Audit Failure, and Audit Risk

Audit risk

It represents the risk that the auditor will

conclude that the financial statements

are fairly stated and an unqualified

opinion can be issued when, in fact,

they are materially misstated.

Liability to Clients

The most common

source of lawsuits

against CPAs

is from clients.

Legal Terms Affecting CPAs’ Liability

Terms related to negligence and fraud









Common Law

Breach of contract: Services not performed by auditors in manner described in contract

Tort liability: Obligation based on failure of auditors to exercise appropriate level of professional care

Ordinary negligence is when a party acts fails to exercise the degree of care that a reasonably prudent person would have used under similar circumstances.

Gross negligence lack of even slight care, indicative of a reckless disregard for one’s professional responsibilities. An example: substantial failures on the part of an auditor to comply with GAAS.

Legal Terms Affecting CPAs’ Liability

Constructive fraud: does not involve a misrepresentation with intent to deceive (gross negligence)


Misrepresentation by a person of a material fact, known by that person to be untrue or made with reckless indifference as to whether the fact is true, with the intention of deceiving the other party and with the result that the other party is injured

Legal Liability Example

Understand the client’s business

Perform quality audits

Document the work properly

Obtain an engagement and a representation letter

Maintain confidential relations


Why Has Auditor Liability Increased?

Highly-publicized failures (WorldCom, Enron)

Investor awareness of ability to recover monetary losses from auditors

Complex accounting standards

Joint and several liability

Mod C-28

Case Study-1


Case Study will not be accepted after the due date or will be deducted if accepted with a legitimate reason.


Audit situations 1 through 10 present various independent factual situations an auditor might encounter in conducting an audit. List A represents the types of opinions the auditor ordinarily would issue, and List B represents the report modifications (if any) that would be necessary. For each situation, select one response from List A and one from List B. Select, as the best answer for each item, the action the auditor normally would take. Items from either list may be selected once, more than once, or not at all.

Assume the following:

• The auditor is independent

• The auditor previously expressed an unqualified opinion on the prior-year financial statements unless otherwise noted

• Only single-year (not comparative) statements are presented for the current year (unless otherwise stated)

• The conditions for an unqualified opinion exist unless contradicted in the factual scenario

• The conditions stated in the factual scenario are material

• No report modifications are to be made except in response to the factual scenario

Factual Scenario:

1. The financial statements present fairly, in all material respects, the financial position, results of operations, and cash flows in conformity with GAAP.

2. In auditing the Long-Term Investments account, an auditor is unable to obtain audited Financial Statement(F/S) for an investee located in a foreign country. The auditor concludes that sufficient competent evidential matter regarding this investment cannot be obtained but it is not pervasive to the financials as a whole.

3. Due to recurring operating losses and working capital deficiencies the auditor has substantial doubt about an entity’s ability to continue as a going concern for a reasonable period of time. However, the F/S disclosures are adequate.

4. The principal auditor decides to refer to the work of another auditor, who audited a wholly owned subsidiary of the entity and issued an unqualified opinion.

5. An entity issues F/S that present financial position and results of operations but omits the related statement of cash flows. Management discloses in the notes to the F/S that it does not believe the statement of cash flows to be useful.

6. An entity changes its depreciation method for production equipment from SL to units of production based on hours of utilization. The auditor concurs with the change, although it has a material effect on the comparability of the entity’s F/S.

7. An entity is a defendant in a lawsuit alleging infringement of certain patent rights. However, management. cannot reasonably estimate the ultimate outcome of the litigation. The auditor believes that there is a reasonable possibility of a significant material loss, but the lawsuit is adequately disclosed in the notes to the F/S.

8. An entity discloses certain lease obligations in the notes to the F/S. The auditor believes that the failure to capitalize these leases is a departure from GAAP.

9. The entity wishes to show comparative F/S and include the prior year. However, the prior year F/S contained a qualification due to an inappropriate method of GAAP. Accordingly, management. corrected the prior year GAAP deficiency and included the updated numbers in the comparative financials for the current year.

10. The entity wishes to show comparative F/S and include the prior year. However, the prior year F/S were audited by another auditor who refuses to reissue his opinion.

List AOpinion ChoicesList BReport Modification Choices
A QualifiedH Describe the circumstances in an explanatory paragraph preceding the opinion paragraph w/o modifying the three standard paragraphs.
B UnqualifiedI Describe the circumstances in the opinion paragraph w/o adding an explanatory paragraph.
C AdverseJ Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the opinion paragraph.
D DisclaimerK Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the opinion paragraph.
E Either Qualified or AdverseL Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the scope & opinion paragraph.
F Either Disclaimer or AdverseM Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the scope & opinion paragraph.
G Either Qualified or DisclaimerN Describe the circumstances in the scope paragraph w/o adding an explanatory paragraph.
O Describe the circumstances in an explanatory paragraph following the opinion paragraph w/o modifying the three standard paragraphs.
P Describe the circumstances in the introductory paragraph w/o adding an explanatory paragraph.
.Q Describe the circumstances in the introductory paragraph w/o adding an explanatory paragraph, and modify the scope & opinion paragraphs.
R Issue the standard auditor’s report w/o modification.
S None of the above.







ACC 415



Overview of auditing and assurance services: Meaning, definition, objectives, types of audit & auditors, Limitations. Distinction between auditing and accounting.

Saudi Organization for Certified Public Accountants (SOCPA): objectives, Saudi Auditing Standards

Chapter -1


The word  ‘Audit’ is originated from the Latin word ‘audire’ which means ‘to hear’. 

The general definition of an audit is an evaluation of a person, organization, system, process, enterprise, project or product.

Auditing is concerned with verification and examination of verifiable information.

Audit means to an independent examination of the financial statements of an enterprises.

To ensure compliance with established policies and operational procedures, and to recommend necessary changes in controls, policies, or procedures.

Independent review and examination of records and activities to assess the adequacy of internal controls,

Meaning of Audit:



“Auditing is a systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between those assertions and established criteria and communicating the results to interested users” (American Accounting Association, 1972).

According to Lawrence R. Dicksee, “an audit is an examination of accounting records undertaken with a view to establishing whether they correctly and completely reflect the transactions to which they relate. In some instances, it may be necessary to ascertain whether the transactions themselves are supported by authority.“

R. K. Mautz defines auditing as being “concerned with the verification of accounting data, with determining the accuracy and reliability accounting statement and reports.”

It is clear from the above definitions that auditing is the systematic and scientific examination of the books of a accounts and records of a business so as to enable the auditor to satisfy himself that the Balance Sheet and the Profit and Loss Account are properly drawn up so as to exhibit a true and fair view of the financial state of affairs of the business and profit or loss for the financial period. The Auditor will have to go through various books and accounts and related evidence to satisfy himself about the accuracy and authenticity to report the financial health of the business


Objectives of Auditing:

(A) Primary Objective:

(a) To produce a report by the auditor of his opinion of the truth and fairness of financial statements so that any person reading or using them can have belief in them.

(B) Secondary Objective:

To detect errors and fraud

To prevent errors and fraud by the deterrent and moral effect of the audit.

To provide spin-off effects. The auditor will be able to assist his client with accounting, system, taxation, financial and other problems.

(C) Others :









Type of Audit:

Statutory Audit/ External audit: A legally required review of the accuracy of a company’s or government’s financial records. The purpose of a statutory audit is the same as the purpose of any other audit – to determine whether an organization is providing a fair and accurate representation of its financial position by examining information such as bank balances, bookkeeping records and financial transactions.

Private Audit: Private audit because of auditor’s desire and not because of law. E.g. sole trader and partnership.

Internal Audit: Internal audit is one conducted by an employee of the business into any aspect of its affairs.



4. Management Audit: Management Audit is an inquiry into efficiency and effectiveness of management.

5. Financial Audit : A financial audit, or more accurately, an audit of financial statements, is the verification of the financial statements of a legal entity, with a view to express an audit opinion. The audit opinion is intended to provide reasonable assurance that the financial statements are presented fairly, in all material respects, and/or give a true and fair view in accordance with the financial reporting framework. The purpose of an audit is to enhance the degree of confidence of intended users in the financial statements.

Investigative Audit : This is an audit that takes place as a result of a report of unusual or suspicious activity on the part of an individual or a department. It is usually focused on specific aspects of the work of a department or individual.


7. Operational Audit :An operations audit is an examination of the operations of the client’s business. In this audit the auditor thoroughly examines the efficiency, effectiveness and economy of the operations with which the management of the entity (client) is achieving its objective

8. Others:

Computer Audit (IT Audit)

Compliance Audit – A compliance audit is conducted to determine whether the auditee is following specific procedures, rules or regulations set by some higher authority. Some examples may include wage laws, and examine contractual agreements with bankers and other lenders to be sure the company is complying with legal requirements.



External Auditors

External Auditors are also known as Independent Auditors or Professional accountants in public practice. An external auditor is an audit professional who performs an audit in accordance with specific laws or rules on the financial statements of a company, government entity, other legal entity or organization

Internal Auditors

Internal auditors are employed by individual corporations, government bodies or other entities. There are different tasks that the individual auditor might perform in the organization, such as financial, internal control, operational and forensic audits and compliance. They might also do consulting within the company. 

Government Auditors

The government auditors work in the public sector, they are employed by the national or local government institutions and public organs. The majority of the government auditors main task is to act as assurance on compliance audit and operational audit. When the auditor audit a entity the assignment is to determine which rules, policies, laws or government regulations the entity follows.

Forensic Auditors

Forensic audits’ mission is to detect, investigate and deter fraud and white-collar crimes. Forensic audits are often employee’s of corporations, audit firms, government agencies and investigative and consulting services firms.



The role of accountancy is to record the transaction in the book of accounts, extraction of trial balance, preparation of Trading and profit and loss account and balance sheet etc.  On the other hand auditing is the examination of books of accounts and checking the financial statements for the purpose of finding out the true and fair position and results of operation of a concern.  Audit is concerned with detailed examination of the complete accounting records but it does not involve the preparation of accounts.

If the auditor is asked to write the books of accounts, extract an agreed trial balance and profit and loss account and Balance sheet, he would be doing the work of an accountant and not the work of an auditor.  Preparation of account is not the part of auditing.  An auditor, using his appointing authority, needs to check thoroughly, whether the Profit and Loss account  and the Balance Sheet have been properly drawn up and reveal the ‘true and fair view’ of the state of affairs and results of operation of the concern and report it to the parties interested.

Auditing without the prior existence of accounts is not possible.  When the accountant finishes his work, the auditor starts his work.


Auditing is determining whether recorded information properly reflects the economic events that occurred during the accounting periodAccounting is the recording, classifying, and summarizing of economic events for the purpose of providing financial information used in decision making.Definition
the main goal of an audit is to perform thorough evaluation of a company’s financial records and reports and provide a company with improvement recommendations based on that evaluationThe main goal of accounting is to provide a company with clear, comprehensive, and reliable information about its economic activities and status of its assets and liabilities.Objective
Auditing ensure such information is reliable and comforts with established rules and regulationsAccounting provides financial information to users of such informationNature
In auditing “Auditor” is a Key person.In Accounting “Accountant” is the key person.Key Person
An audit is a review of the accounting practice.Accounting is the day to day practice of administering the financial aspect of a business, such as invoicing, billing, banking etc…Review
The auditing work start after completion of Accounting work.Accounting work done in first stage.Stage



The responsibility for preparation and presentation of the financial statements is that of directors of the entity. The audit does not relieve the directors of any of their responsibilities.:

Auditors opinion is not a guarantee of the future sustainability of the entity.

Auditors opinion is not an assurance of management’s effectiveness and efficient.

Informal relation

The auditors attitude is not professional.

Interference or Pressure of Management

Limitation of Audit


Auditing in Saudi Arabia




Historical Background:

The 1965 Companies Act the first law in Saudi Arabia to recognize the accounting profession and to require company management to prepare audited financial statements for shareholders

The first law to regulate the auditing profession in Saudi Arabia was the 1974 Law of Certified Accountants. Articles 2 and 3 set the conditions for individuals to register as an external auditor with the Ministry of Commerce.

The development of accounting and auditing in Saudi Arabia was the establishment the Saudi Organization for Certified Public Accountants (SOCPA)

The rapid growth in the number and size of Saudi Arabian companies and the introduction of new technology has enhanced the need for internal control, monitoring and evaluation


Saudi Organization for Certified Public Accountants (SOCPA) is a professional organization established under Royal Decree No. M12 dated 1.05.1412H corresponding to 19.11.1991G.

It operates under the supervision of the Ministry of Commerce in order to promote the accounting and auditing profession and all matters that might lead to the development of the profession and upgrading its status.

The SOCPA consisting with A thirteen members Board manages.

Objectives of SOCPA:

Review, develop and approve accounting and auditing standards.

Monitoring the performance of certified public accountants to ensure their compliance with accounting and auditing standards and with the provisions of CPA (Certified Public Accountant) Regulations and its by- laws.

Establish SOCPA fellowship examination rules and organize CPE courses.

Conduct researches and studies; publish periodicals, books and bulletins covering accounting and auditing subjects; and participating in local and international committees and symposiums relating to the profession of accounting and auditing.

Saudi Organization for Certified Public Accountants (SOCPA)



Auditing standards, which cover : general standards including professional qualification, independence, due care; standards of field work including planning, Control, Recording, Evidence, Reporting and relevant procedures.

The royal decree No. M/12 dated 13-05-1412H was issued approving CPAS’ Regulations. Article 2 concerning the conditions of enrollment in the register, requires for registration as CPA that the applicant shall be, among other requirements :

Holder of a Bachelor’s degree in Accountancy or any other equivalent Certificate as may be deemed acceptable by the competent authorities in charge of equivalency of degrees

Having practical experience in the field of accounting after graduation with any of the following bodies :

(A)Certified public Accountants firms. This period of service shall be for a minimum of three years, reducible to two years if the applicant is a holder of a Master’s degree in accountancy or an equivalent degree, and to one year if the applicant is a holder of a PH.D. in accountancy or an equivalent degree.

(B)Government bodies, companies or sole proprietorships according to the conditions and terms stipulated in the Executive By-laws, provided that such terms are no less than those stated in paragraph (A) above.

Full member of the Saudi Organization for Certified public Accountants(SOCPA) 



Article 11 requires a CPA to attend a given number of seminars as may be specified and held by SOCPA.

 Article 19 stated that SOCPA is entrusted to organize course of continuous education within its duties to promote the profession

Article 20 states the organization consists of the following :

Full members, namely :

(A) All Certified Public Accountants licensed to practice the profession in the Kingdom at the time these regulations come into force, provided that they attend the course held by the organization and pass the examinations within a period not exceeding three years.

(B) Those who hold the qualifications provided for in paragraph (4) Article (2) of the regulations, provided that they obtain the fellowship certificate.



Associate members and they are those who apply for membership from among those who hold the qualifications refereed to in paragraph (4), Article (2) of the regulations

Article 25 specified the power SOCPA board of directors’ which included organization of programs and courses of continuous professional education

SOCPA education and training committee issued it aims to update the information’s, professional and technical skills in subjects related the accounting and auditing profession, for the purpose of maintaining or improving professional and technical competence

The rules considered CPE as mandatory to SOCPA members. Non. Compliance with these rules may cause cancellation of membership

The education and training committee is authorized to accept or reject the reasons for non-compliance with CPE requirements 


Assurance Services

Assurance services are professional

services that improve the quality of

information for decision makers.

Assurance services can be

performed by CPAs or by

a variety of other professionals.



Attestation Services

An attestation service is a type of assurance

service in which the CPA firm issues a

report about the reliability of an assertion

that is the responsibility of another party.


Other Assurance Services

Most other assurance services do not meet the

formal definition of attestation services.

The CPA must be independent.

The CPA is not required to provide a written report.

The CPA must provide assurance.


Assurance Services on Information Technology

There is an increased demand for assurance

about computer controls surrounding

information transacted electronically

and the security of the information

related to the transactions.

– assurance over Web site controls

– assurance about information system reliability


Assurance Services on Information Technology

WebTrust is an attestation service, and the

WebTrust seal is a symbolic representation

of the CPA’s report on management’s

assertions about its disclosure of

electronic commerce practices.


Assurance Services on Information Technology

SysTrust is an attest-type engagement

to evaluate and test system reliability in

areas such as security and data integrity.


Other Assurance Services Examples

Controls over and risks related to investments,

including policies related to derivatives…

assessing the processes in a company’s

investment practices to identify risks and to

determine the effectiveness of those processes.



Other Assurance Services Examples

Mystery shopping…

performing anonymous shopping to

assess sales personnel dealings with

customers and procedures they follow.



Other Assurance Services Examples

Assess risks of accumulation, distribution,

and storage of digital information…

assessing security risks and related

controls over data and other information

stored electronically, including the

adequacy of backup and off-site storage.



Other Assurance Services Examples

Fraud and illegal acts risk assessment…

developing fraud risk profiles and assessing the

adequacy of company systems and policies in

preventing and detecting fraud and illegal acts.



Assurance, Attestation, and Nonassurance Services


Other Attestation Services

(e.g., WebTrust, SysTrust)

Other Assurance Services

(e.g., CPA Performance View)








Assurance, Attestation, and Nonassurance Services


Other Management







Accounting and



Order your essay today and save 10% with the discount code ESSAYHELP