SA 200, Overall objective of an independent auditor and conduct of an audit in accordance with standard on auditing

SA 200, Overall objective of an independent auditor and conduct of an audit in accordance with standard on auditing

1. Overall Objective :

To obtain reasonable Assurance that 

• financial statement as a whole are free from material misstatement.
• financial statement are being prepared in accordance with applicable financial reporting framework.
• Auditor has express an opinion on the financial statement.

2. Applicable Financial Reporting Framework:-

• F.R.F. adopted by the management and TCWG.
• In preparation and presentation of financial statements that is 
• i. acceptable as per the circumstances or
• ii. required by law.

3. Financial Statement:-

• A structured representation
• of historical financial information,
• including related notes,
• intended to show entity's economics results & position
• as per applicable F.R.F.

4. Premises on which audit is conduct:-

 Premises = Basic Assumption

• That management & TCWG have following responsibilities:

1. For presentation and preparation of financial statements,
2. Implementation of I.C.
3. To provide the auditor with:

• All Information,
• Additional Information &
• Unrestricted access.

5.  Professional skepticism:- 

• state of questioning mind 
• state of being alert to condition
• Critical Assessment.
• 

6. Professional judgement:-

• Application of training, knowledge and experience in the field of accounting and auditing to take appropriate decisions.

 7. Conduct of audit in accordance with Standard on Auditing:-

• Auditor should comply with every SAs.

8. Code of ethics:-

• Integrity 
• Objectivity 
• Confidentiality 
• Professional competency 
• Professional behavior.

9. Inherent Limitations of an Audit:-

• Auditor can not obtain absolute assurance.
• This is due to inherent limitations of an audit due to which auditor obtains persuasive evidence rather than conclusive.
• 1. Nature of financial reporting
• 2. Nature of audit procedure
• 3. Balance between cost benefit and time
• 4. Other factor

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