Importance of Generally Accepted Auditing Standards (GAAS)

Accounting Importance of Generally Accepted Auditing Standards (GAAS) Miriam Manjarres November 18, 2012 Abstract The Generally Accepted Auditing Standards are standards that were developed through the American Institute of Certified Public Accountants as a foundation in conducting an audit in its reasonable accuracy. There is a need for auditors to follow the standards provided to be able to render a report of the financial statements audited stating that it is free from any misstatement. GAAS are divided into three categories such as the general standards, the standards of fieldwork and standards of reporting. Auditors can render reports of the financial statements audited in four ways. The report†¦show more content†¦Auditors and GAAS Auditors have an important role in the business world. They are primarily in charge with checking the accuracy of the financial statements reported by business entities. These business entities are required to record,interpret and report every business transaction that has a corresponding effect on the comapany’s economic standing. The whole business process of every business entity or organization are done or made in accordance with the Generally Accepted Accounting Principles.(GAAP) However, there are instances that business entities do not accurately follow the rules and guidelines provided in the GAAP. Some entities are doing it without the intention to defraud others but there are also others who delineate f rom the standards provided with the intention to mislead others into believing that the company is performing well or has enough assets to pay all of its liabilities despite the opposite fact. 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