Auditing Essay Example | Topics and Well Written Essays - 2000 words - 5

Auditing - Essay ExampleThe evaluation of the inspect risks involved in the audit of the company is analyzed and thus explained their extent and effect. Along with the ingrained risks of audit there are various other risks that are involved in the audit of a company. Auditors check for material misstatement in the financial statements and report accordingly. However there are risks involved in audit which are inherent risks as the management of the company is involved in the operations and recording of the transactions and thus leave alone assertions upon the financial statements of the company and thus the auditors are to check the assertions as well. The audit risks involved in the audit of Mobile Streams Plc. is elaborated belowThe company is operating as a group and the financial statements vigilant and presented are of the parent and of the group. The risk of disclosure of the related party disclosures along with the measurements of the holding percentages shall be a risky element in the financial statements. Mobile Streams Plc. undergoes complex, diverse and decentralized business operations as it is operating as a group and these characteristics increases the risk of material misstatements (C. WILLIAM & PHIL, 2013). Along with the management and disclosures of the complex chronicle intercessions there is a risk that accounting for the consolidation in the group shall not be mighty accounted for as the local accounting treatments are different as to the level of adoption of financial reporting standards. The consolidation of the financial statements increases the risk as the financial information is obtained from different segments and then consolidated and the attainment of information from wide source increases the risk of misstatement.Consolidating the accounts of parent and subsidiary is a complex accounting treatment and thus increases the audit risks as per the