No doubt auditing is essential for an organization or individual account. These are some most important characteristics/features of an audit. The essential features of an audit can be described as follows:
Features of an Audit
1. Systematic process: Auditing is a systematic and scientific process that follows a sequence of activities, which are logical, structured, and organized.
2. Three-party relationships: The audit process involves three parties, that is, shareholders, managers, and auditors.
3. Subject matter: Auditors give assurance on a specific subject matter. However, the subject matter may differ considerably, such as – data, systems, or processes and behavior.
4. Evidence: The auditing process, requires collecting the audit evidence, that is, financial and non-financial data, and examining thereof.
5. Established criteria: The evidence must be evaluated in terms of established criteria, which include International Accounting Standards, International Financial Reporting Standards, Generally Accepted Accounting Principles, industry practices, etc.
6. Opinion: The auditor has to express an opinion as to the reasonable assurance on the financial statements of the entity.
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