03 UAAP and IFRS are examples of J 8 Violations of GAAS Whi

. 03 UAAP and IFRS are examples of_ J. 8. Violations of GAAS. Which of the 10 standards is violated in each of the following independent situations? Some situations may violate more than one. a. A team of auditors, each with varying levels of experience, divided up the audit tasks and completed them independently before expressing an opinion on the statements. b. An audit client changed its inventory cost flow assumption from LIFO to FIFO in the last year. The audit opinion makes no mention of the change.

Solution

A. Standard which is violated is standard of reporting No 4. According to this standard the auditor must express their opinion as a whole or state that an opinion cant be expressed in auditors report. Since all auditors has given their opinion individually. This standard is violated.

B. Standard of reporting No . 2 is violated. This states that if there is any principle which is not consistently followed by the client from preceding year that shall be reported in the audit report. Since client has changed inventory cash flow from LIFO to FIFO it should have been mentioned in the audit report.

C. Standard of Fieldwork No. 3 is violated. This states that auditor must obtain sufficient audit evidence by performing the audit procedures to reach at a reasonable basis. Since Auditors has relied solely on client\'s assertion it has not performed the required audit procedures.

D. General Standards No 2 is violated. According to this standard independence should be maintined while performing audit.

E.Standard of Fieldwork No. 3 is violated. This states that auditor must obtain sufficient audit evidence by performing the audit procedures to reach at a reasonable basis. Since Auditors has relied solely on client\'s assessment of AIS integrity in determining compliance test of audit it has violated this standard.