audit objective

1. The purpose of an audit. Audits are normally performed to support or refute specific objectives. The external audit of an organization, for example, typically has the following main objectives: "To obtain evidence that the organization’s financial statements conform with *Generally Accepted Accounting Principles, and offer a *fair representation of the entity’s financial position, the results of its operations, and changes in cash flows." If sufficient *audit evidence is gathered to confirm these objectives, the external auditor can issue an *unqualified opinion. (Secondary objectives of an external audit may include the identification of *material *fraud, or serious weaknesses in *internal controls.) The objectives of internal auditing tend to be more varied than those of external auditing: This reflects the wide remit of internal auditing, through *financial and Operational audits to Compliance and Consulting reviews. 2. The purpose of a specific *audit test. It is generally considered best practice to state an objective (or objectives) for each individual audit test, and to conclude on the objectives after sufficient *audit evidence has been gathered to perform the test. For example, an audit *work paper may start as follows: "To obtain evidence that bank balances are accurately stated and correctly classified in the *general ledger." It may finish as follows: "objectives achieved." The formal stating of objectives for each audit test encourages the focus of auditing work in contributing to the overall objective of the audit. If the objectives of a specific test are not met, then alternative tests may be required.