United States Generally Accepted Auditing Standards

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The United States Generally Accepted Auditing Standards (GAAS) are a group of ten standards from the American Institute of Certified Public Accountants (AICPA). The US-GAAS contain requirements for auditors to carry out audits in order to ensure the accuracy, consistency and traceability of the audit procedures and reports. Since it was built in 1947, only minor changes have been made.

The US GAAS apply to the auditing of US companies. In the European Union , the International Standards on Auditing (ISA) - partially supplemented by national standards such as the German IDW auditing standards - perform a comparable function.

The GAAS are structured as follows:

General Standards

  1. The auditor must have been properly trained and have the necessary knowledge to conduct an audit.
  2. The auditor must actually and apparently maintain his independence with regard to all matters relating to the audit.
  3. The auditor must exercise due professional care while performing the audit and preparing the audit report.

Standards of Field Work

  1. The auditor must plan the workflow appropriately and carefully supervise each of his assistants.
  2. The auditor must acquire sufficient knowledge of the business entity including its internal control systems, assess the risk of material misstatement - be it due to error or fraud - in the audited financial statements, and determine the type, timing and scope of further audit activities.
  3. The auditor must obtain sufficient audit evidence as part of his audit activities in order to have a sound basis for the audit opinion to be submitted by him.

Standards of reporting

  1. The auditor must state in his report whether the financial statements were prepared in accordance with (US) GAAP .
  2. The auditor must clearly indicate in his report if the audited financial statements deviate from GAAP or the consistency of their application
  3. If the auditor finds that information has not been given in an appropriate scope or manner, he should state this in his report.
  4. The auditor must either issue an audit opinion on the audited financial statements as a whole or include the denial of an audit opinion in his report. If the auditor is unable to issue an unqualified audit opinion, he should disclose his reasons in his report. In all cases in which the name of the auditor is associated with the audited financial statements, the auditor should clearly state in his report to what extent audit activities were carried out and whether - and to what extent - the auditor accepts liability.

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