AUDITED ACCOUNT Meaning and
Definition
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An audited account refers to a detailed financial statement of a company or an individual that has undergone a thorough examination by an independent auditor to validate its accuracy, completeness, and compliance with applicable financial reporting standards. This process, known as an audit, aims to present a fair and unbiased representation of an entity's financial position, performance, and cash flows.
An audited account is often accompanied by an auditor's report, which outlines the scope of the audit, procedures performed, and the auditor's opinion on the financial statements' fairness and reliability. The objectives of auditing include ensuring compliance with legal requirements, verifying the reliability of financial information, detecting fraud or errors, and providing stakeholders with reliable financial statements for decision-making purposes.
Audited accounts follow a series of procedural steps, such as examination of financial records, verification of transactions, assessment of internal control systems, confirmation of assets and liabilities, review of supporting documents, and testing of financial statement assertions. Auditing standards and techniques are employed to guarantee the credibility and integrity of the audit process. These standards generally are set by professional accounting bodies, ensuring consistency and adherence to ethical principles and guidelines.
The audited account is crucial for investors, creditors, regulators, and other stakeholders as it enhances transparency and provides an independent review of the financial health and performance of an entity. It helps in establishing trust, reducing information asymmetry, and increasing the reliability of financial information for decision-making purposes.
Common Misspellings for AUDITED ACCOUNT
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Etymology of AUDITED ACCOUNT
The word "audited account" is derived from two separate origins.
The term "audit" has its roots in Latin. It comes from the Latin word "audire", which means "to hear". In ancient Rome, the accounts and financial statements were read out loud to ensure accuracy. Over time, the word "audit" became associated with the process of examining and verifying financial records.
The word "account" has Old French and Latin origins. It is derived from the Old French word "acont", meaning "reckoning", which further traces back to the Latin word "computare", meaning "to calculate" or "count".
When combined, the term "audited account" refers to a financial statement or record that has been examined by an auditor to ensure its accuracy and compliance with relevant regulations and standards.
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