Audit Reporting Requirements


Auditor’s report is made by a qualified auditor after a thorough examination of all necessary documents that form part of the basis on hich he will base his opinion. Auditors can render varied opinions which may include unqualified opinion, qualified opinion, a disclamer of adverse opinion depending on the information they obtain after independent examination of all documents and disclosures of a firm. International Auditing Standards dictate that every auditing exercise and generation of an audit report must conform to specific audit reporting reporting requirements. The audit report developed by Raphael and VanFyck, LLP lack some vital reuirements which are discussed here in.

Statement idenifying each financial statement and any related schedules that ought to be audited

The auditing firm has not clearly stated the types of financial statements which were audited. The auditor has not mentioned statement of comprehensive income, statement of financial position, statement of cash flow and statement of shareholders equity. The statement to be included is “We have audited statement of comprehensive income, statement of financial position, statement of cash flow and statement of shareholders equity”

Critical audit matters

The auditor while reporting on the audited accounts of Citizens of Prairie View missed to indicate in his report the critical audit matters that arose during his aaudit. A paragraph on critical audit matters is important as it documents pertinents issues that will benefit the users more especially the shareholders to make informed decisions and more importantly know the state of affairs of the company. Nonetheless, if the auditor did not find any critical audit matter he ought to include a statement that he established that there no critical audit matters that were material to report.

A statement the auditing firm is a public accounting firm

A statement indicating that  Raphael and VanFyck, LLP is a public accounting firm and is duly registered carrrying her activities within the realms of the law. Additionally, a statement indicating Raphael and VanFyck, LLP is required to be independent with respect to Citizens of Prairie View in accordance to the federal laws and other regulations.

Identification of the applicable financial reporting framework

The auditor while expressing his opinion that the financial statements were presented fairly in all material aspects he did not mention the basis of financial reporting. For example the auditor would have included International Financial Reporting Framework as an applicable financial reporting framework. This will add credibility to the report.

Explanatory paragraph

An explanatory paragraph should be included to document a material misstatement if any from the previous published financial statements. A statement that the misstatement has been corrected will create more confidence on the users and bring conformity to the reporting requirements. If the auditor relied on the work of the previous auditors of the firm, he has to document it in the explanatory parapraph for the purposes of conformity.

Signing off and tenure

The auditing firm should sign the report to give it authetencity and to make more credible. It is a requirement all reports made by auditors should signed by the auditing firm. The auditing firm should give a statement indicating the period or year they statrted working for the company.


To this end, if the above changes are made the report of Raphael and VanFyck, LLP will bring conformity with the audit reporting requirements. Inclusion of  a statement the auditing firm is a public accounting firm, critical audit matters, statement idenifying each financial statement and any related schedules that ought to be audited, identification of the applicable financial reporting framework, explanatory paragraph and signing off and tenure would supplement the work of the auditor hence bringing conformity with the basic audit requirements.


AICPA, S. (2017). No. 99. 2002. Consideration of Fraud in a Financial Statement Audit. New York: AICPA.

Boolaky, P., & Omoteso, K. (2016). International standards on auditing in the international financial services centres: What matters?. Managerial Auditing Journal.

Daske, H., Hail, L., Leuz, C., & Verdi, R. (2008). Mandatory IFRS reporting around the world: Early evidence on the economic consequences. Journal of accounting research46(5), 1085-1142.

Roussey, R. S. (1999). The development of international standards on auditing. the CPA Journal, 69(10), 14.

Smith, M., Sagafi-Nejad, T., & Wang, K. (2008). Going international: Accounting and auditing standards. Internal Auditing, 23(4), 3-12.


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