What DoesGenerally Accepted Auditing Standards - GAASMean?
Aset of systematic guidelines used by auditors when conducting audits oncompanies' finances, ensuring the accuracy, consistency andverifiability of auditors' actions and reports.
Investopedia explainsGenerally Accepted Auditing Standards - GAAS
Byrelying on GAAS, auditors can minimize the probability of missingmaterial information. GAAS are divided into these main sections:
1) General standards.
2) Standards of fieldwork.
3) Standards of reporting.
Eachsection is littered with requirements that the auditor and the subjectcompany must meet. In short, an auditor must adequately plan the auditin advance, be independent of the client at all times, and alwaysobtain reliable evidence. The companies must present their financialstatements in accordance with GAAP, remain consistent in theirreporting, and explicitly disclose all pertinent information.
