assignment audit meaning

Types of Audits: 14 Types of Audits and Level of Assurance (2022)

The audit is an art of systematic and independent review and investigation on a certain subject matter, including financial statements, management accounts, management reports, accounting records, operational reports, revenues reports, expenses reports, etc.

The result of reviewing and investigation will be reported to shareholders and other key internal stakeholders of the entity for their decision-making or other purposes.

Audit reports sometimes submit to other stakeholders like the government, banks, creditors, or the public.

For example, the statutory audit report is submitted to the regulator or authority like the tax department, the central bank, or the security authority.

The audit is classified into many different types and levels of assurance according to the objectives, scopes, purposes, and procedures of auditing.

The execution of financial statements auditing normally follows International Standards on Auditing (ISA) and other local auditing standards.

There are many types of audits including financial audits, operational audits, statutory audits, compliance audits, and so on.

In this article, we will explain the main 14 types of audits being performed in the current audit industry or practices.

Here is the list of 14 Types of Audits and Levels of Assurance:

1) External Audit:

The external audit refers to the audit firms that offer certain auditing services, including Assurance Services, Consultant Services, Tax Consultant Services, Legal Services, Financial Advisory, and Risk Management Advisory.

The best example of external auditing services is the services these big four audit firms provide, including KPMG, PWC, EY, and Deloitte.

External auditors are normally referred to as audit staff who are working in audit firms. The positions are ranked from audit associate, and senior auditors to audit partners, and managing partners.

These kinds of firms are sometimes called CPA firms as they are required by law to hold a CPA qualification/certificate to run an audit firm and issue audit reports .

This type of audit requires maintaining the professional code of ethics and strictly following International Standards on Auditing and local standards as required by local law.

The firms are working independently from auditing clients that they are auditing. If a conflict of interest has occurred, proper procedures must be taken to minimize the conflicts.

The firm should consider withdrawing from the audit engagement if the impairment cannot minimize to an acceptable level.

Some external audit firms are also offering internal audit services. The popular services offered by external audit firms are an audit of financial statements, tax consultant, and advisory services.

2) Internal Audit:

Internal Auditing is an independent and objective consulting service designed to add value to the business and improve the entity’s operation.

It provides a systematic and disciplined approach to evaluating and assessing risk management, internal control, and corporate governance.

The audit committee generally determines the scope of the internal audit , the board of directors, or directors with equivalence authorization. And if there is no audit committee and board of directors, an internal audit normally reports to the entity owner.

Internal audit activities normally cover internal control reviewing, operational reviewing, fraud investigation, compliant reviewing, and other special tasks assigned by the audit committee or BOD.

3) Forensic Audit:

The forensic audit is normally performed by a forensic accountant who has the skill in both accounting and investigation.

Forensic Accounting is the type of engagement undertaking the financial investigation in response to a particular subject matter. The findings of the investigation normally are used as evidence in court or conflict resolution among the shareholders.

The investigation covers several areas: fraud investigation, crime investigation, insurance claims, and disputes among shareholders.

A forensic audit is also needed to have a proper plan, procedure, and report like other audit engagements.

Forensic audit also needs to follow ethical guidelines like an audit of financial statements . This kind of engagement is not so popular as an audit of financial statements or statutory auditing .

4) Statutory Audit:

Statutory audit refers to an audit of financial statements for the specific type of entities required by law or local authority.

For example, all banking sectors require their financial statements to be audited by qualified audit firms authorized by their central bank.

The statutory audit might be different from financial statements auditing as the financial audit refers to the audit of all types of entity’s financial statements, including whether both meeting or not meet the government’s requirements.

However, statutory audit refers to only auditing the entity’s financial statements required by local law.

External audit firms normally perform the statutory audit, and the audit report will be issued by the auditor and submitted to the government body by the entity. Not by the auditor.

The best example of firms that offer statutory auditing is KPMG, PWC, EY, …. etc.

The common criteria set by law that require entities to have their financial statements by qualified audit firms are annual turnover, the value of assets, and the number of staff the entity employed.

Some countries may require companies in specific industries like banks, minerals, and others based on their decision to have those companies’ financial statements audited.

Companies listed on the stock exchange are generally required and enforced by the stock exchange authority to have a qualified audit form audit their financial statements.

5) Financial Audit:

Financial audit refers to the audit of the entity’s financial statements by an independent auditor where audit opinion will be provided on those financial statements after auditing works are done.

A financial audit is normally performed by an external audit firm that holds a CPA and is normally performed annually and at the end of the accounting period. This type of audit is also known as financial statements auditing.

But, sometimes, as required by management, bank, security exchange, regulation, or else, the financial audit is also performed quarterly.

Most entities prepare their financial statements based on IFRS, and some financial statements are prepared based on local GAAP.

For example, financial statements are prepared based on US GAAP for the entity registered in the US. If the financial statements are prepared based on IFRS, the financial audit needs to be audited against IFRS.

However, if the financial statements are prepared based on local GAAP, then the audit needs to be performed against those local GAAP.

The audit standards used by the auditor to conduct financial audits need to adopt international standards and local law requirements.

Some country requires an audit firm to follow its audit standards while others have adopted international standards and transformed them into local ones.

6) Tax Audit:

A tax audit is a type of audit that performing by the government’s tax department or tax authority.

A tax audit could be performed as the result of in-compliant found by a government agency or the schedule set by the government tax department.

An entity needs not to invite or engage with the tax authority to come to perform a tax audit. They will come by themselves. An entity just needs to file its tax obligation properly and timely based on the country’s tax law.

To minimize the penalty as the result of the tax audit, the entity is recommended to follow all the requirements set by tax law and for those areas that they are not sure about, the entity should engage with a tax consulting firm for advice. As mentioned above, the big four firms also offer such a service.

7) Information System Audit or Information Technology Audit (IT Audit)

An information system audit is sometimes called an IT audit. This type of audit assesses and checks the reliability of the security system, information security structure, and integrity of the system so that the system’s output is reliable.

Sometimes, financial auditing also requires IT auditing as now technology is increasing and most of the client’s financial reports are recorded by complex accounting software.

The audit approach also changed due to the changing of management’s approach in recording and reporting their entity’s financial information.

Normally, before relying on information systems (software) that are used for producing financial statements, auditors must have IT and audit teams test and review that information system first.

Especially, when an entity uses an ERP system where the operational reportings are also integrated with the accounting system. For example, a banking system normally links operational reporting with the accounting system.

IT audit is also offered and requested separately from the financial audit.

As you know, most big firms have this kind of service. They do not only provide IT audits but also offer consultants in the information system areas.

8) Compliance Audit

A compliance audit is a type of audit that checks against the internal policies and procedures of the entity as well as the laws and regulations where the entity operates. Law and regulation here refer to the government’s law where the business is operating.

For example, in the banking sector, there are many regulations required for bankers to follow and comply with.

Most of the central banks require commercial banks to set up a complaint review (assessment) or compliance audit to ensure that they comply with those laws and regulations.

The entity may also assign its internal audit function to review whether the entity’s internal policies and procedures are complying and effectively followed.

A compliance audit is part of the system used by the entity’s management to enforce the effectiveness of the implementation of the government’s laws and regulations, and the entity’s internal policies and procedures.

9) Value For Money Audit

Value for money audit refers to activities that assess and evaluate three main difference factors: Economy, Efficiency, and Effectiveness of entity operation.

Economically, the auditor assesses and evaluates whether the resources that the entity purchases are at a low cost with acceptable quality whereas efficiency audit, the auditor checks whether the resources that the entity use have a better conversion ratio.

Effectiveness, by the way, looks at the big picture of the objective whether the entity using the resources meets its objective or not.

The auditor might review the entity’s purchasing system to assess and evaluate whether it is helping the entity to purchase materials or services at low costs or not.

Value for money audit is really important for the entity since it helps the entity improve resource efficiency usage and make sure that the entity obtains good quality material at a low cost.

10) Review Financial Statements

Reviewing financial statements is a type of negative engagement where auditors review the entity’s financial statements.

At the end of the review, the audit is not going to express whether financial statements are a true and fair view and free from material.

But, the auditor will issue the opinion to say that nothing is coming to their attention that financial statements are not prepared with a true and fair view and free from material.

This kind of service is normally required when an entity borrows money from the bank. And the banks, as part of their policy require the entity to provide financial statements reviewed by an external auditor .

Or sometimes it is requested by management to have their financial statements before asking for the auditor to audit the financial statements . Or sometimes it is required by management for internal use.

11) Agreed Upon Procedures (AUP)

The agreed-upon procedure is the type of negative engagement where auditors review the procedures agreed upon with the client. This type of engagement is called limited assurance.

Even though the client’s procedures are set, auditors must also ensure that the firm has enough resources to perform the job and the fee is not low-balling.

Auditors will also need to ensure no conflict of interest between the audit and client management teams.

If the auditor finds a conflict of interest, the safe guide needs to be checked and introduced to reduce the conflict.

Once auditors complete their review or perform all the procedures required by management, they will issue the factual finding report by listing down all the findings they found during the audit.

12) Integrated Audit

Integrate audit happens when there are two different areas of audit requirements. For example, there is a financial audit and a social audit, or some areas need to be confirmed with the financial audit.

For example, NGOs require their financial statements to be audited, and the technical areas that those NGOs are spending the money on need to be audited by a specialist auditor.

For example, NGOs are working on public health and most of the money spent is related to public health.

Besides the expense reports that present the expenses that NGOs paid for and need to be audited by the financial auditor, there are many technical reports like health reports that need to be verified by technical auditors that have experience in assessing health reports.

This is called an integrated audit. The integrated audit also happens when the entity operates in many different countries, and the financial statements are audited by different audit firms.

13) Special Audit

A special audit is a type of audit assignment that is normally done by the internal auditor.

This happens when a problem/case occurs in the organization, like fraud, business case, or other special cases.

For example, fraud occurred in the payroll department, and this concern was raised to the audit committee or board of directors, or sometimes there is a request from the CEO to have a special audit on these areas.

The special audit is a bit different from the forensic audit as a special audit is done by the internal staff of the entity.

Once the auditor completes the audit, then the report is prepared by the audit team and then submitted to the audit committee or board of directors. It is sometimes also reported to the CEO of the entity.

14) Operational audit

An operational audit is a type of audit service that mainly focuses on key processes, procedures, systems, and internal control. The main objective is to improve the operation’s productivity, efficiency, and effectiveness.

Operation audit has also targeted the leak of key control and processes that cause waste of resources and then recommended improvement.

Operational audit is part of the internal audit and their main aim is to add value to the business and their professional services.

Systematic and highly disciplined is also the part that helps to make sure the operational audit adds value to the organization. Written by Sinra

How to prepare an internal audit program tips and guidance, review engagement (limited assurance): definition and example, 5 types of due diligence services, benefits, and limitations, what is internal audit department (responsibilities and more).

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Complete Audit Assignment - Step by Step

Today we will look at the steps that external auditors need to take to complete an audit. Once the external auditors have completed their substantive testing, there are still many procedures that they need to complete before the audit report is provided to client. Here are the key steps in completing an audit engagement, with reference to respective ISA.

Step 1 - Final review of the audit file to ensure quality control is in place

Before the audit report is drafted, the audit engagement manager and partner will review the audit file to ensure proper procedures have been applied based on which the engagement partner can form an opinion. Reviewing the audit file is also necessary to ensure the quality of the audit.

ISA 220 Quality Control for an Audit of Financial Statements

Concerning quality control of audit documentation with regards to completion of an audit, ' ISA 220 - Quality Control for an Audit of Financial Statements ’ states that:

The engagement partner shall take responsibility for reviews being performed in accordance with the firm’s review policies and procedures.

On or before the date of the auditor’s report, the engagement partner shall, through a review of the audit documentation and discussion with the engagement team, be satisfied that sufficient appropriate audit evidence has been obtained to support the conclusions reached and for the auditor’s report to be issued.

The standard requires the engagement partner to review the work performed by the members of the audit assignment team before completing an audit.

The audit engagement partner will generally review critical areas of judgement, areas of significant risk and other areas that they deem important to ensure compliance with the standard in regards to the quality of the audit.

The standard does not require the audit engagement partner to review all documentation related to the assignment but they may choose to do so if they deem necessary.

ISA 520 Analytical Procedures

ISA 520 – Analytical Procedures deals with the auditor's use of analytical procedures as substantive procedures in response to assessed risks, and as procedures that assist in arriving at the auditor's overall conclusion in an audit of financial statements.

Under the paragraph “Analytical Procedures that Assist When Forming an Overall Conclusion” states that:

The auditor shall design and perform analytical procedures, near the end of the audit, that assist the auditor when forming an overall conclusion as to whether the financial statements are consistent with the auditor’s understanding of the entity.

Before forming an overall conclusion regarding the financial statements of the audit, the auditor should perform analytical procedures to verify their opinion formed during the audit of individual components or elements of the financial statements.

Analytical procedures may include different methods such as ratio analysis, trend analysis or comparisons with prior period financial statements. This can help the auditor identify any unusual transactions or balances that may indicate a risk of misstatement.

Through the use of analytical procedures, the auditor probably comes across any previously unknown information, then, it is required to revise the risk of material misstatement assessed before.

This may also require the auditor to perform further audit procedures according to the newly identified information. The auditor may also need to carefully consider the disclosures in the notes to the financial statements and any other information that is issued with the financial statements to ensure they are consistent with the financial statements.

Step 2 - Evaluation of misstatements

Next step to complete an audit assignment is to evaluate the misstatements identified during the audit. This is done under ' ISA 450 - Evaluation of Misstatements Identified During the Audit '. Regarding the steps taken before the completion of an audit, ISA 450 states that:

The auditor shall determine whether uncorrected misstatements are material, individually or in aggregate. In making this determination, the auditor shall consider:

(a) The size and nature of the misstatements, both in relation to particular classes of transactions, account balances or disclosures and the financial statements as a whole, and the particular circumstances of their occurrence; and

(b) The effect of uncorrected misstatements related to prior periods on the relevant classes of transactions, account balances or disclosures, and the financial statements as a whole.

The standard requires the auditor, before giving a report, to evaluate the effect of any uncorrected misstatements and if necessary, reassess the materiality per ISA 320.

The auditor must determine whether the uncorrected misstatements are material, individually or in aggregate. The auditor must also determine the effect of any uncorrected misstatements from prior accounting periods that may affect the current financial statements.

These misstatements are generally discussed with the client in the audit clearance meeting before providing the client with an audit report. If the misstatements remain uncorrected, the auditor will have to modify their report accordingly.

Step 3 - Review of subsequent events

During the process of completion of an audit, the auditor must also determine the effect of any subsequent events relevant to client’s financial statements.

This is done per ' ISA 560 – Subsequent Events ' which requires the auditor to perform audit procedures to obtain sufficient appropriate audit evidence that all events occurring between the date of the financial statements and the auditor’s report that require adjustment of, or disclosure in, the financial statements have been identified.

In regards to the completion of an audit, the standard states that:

[if] the auditor identifies events that require adjustment of, or disclosure in, the financial statements, the auditor shall determine whether each such event is appropriately reflected in those financial statements in accordance with the applicable financial reporting framework.

The standard requires the auditor to perform procedures to ensure that the events that occur between the date of the financial statement and the date of the auditor’s report, the require an adjustment or a disclosure within the financial statements are reflected in the financial statements.

The auditor can achieve this by reviewing the subsequent accounting records of the business or analyzing minutes of the management meetings after the year-end. These checks need to be carried out as close to the audit report date as possible to ensure all subsequent events are identified and adjusted.

Step 4 - Review of going concern

The auditor must also review the going concern status of the client business before providing an audit report. This is done following ISA 570 – Going Concern .

The standard states that the auditor shall remain alert throughout the audit for audit evidence of events or conditions that may cast doubt on the entity’s ability to continue as a going concern. Furthermore, it states that:

The auditor shall evaluate whether sufficient appropriate audit evidence has been obtained regarding, and shall conclude on, the appropriateness of management’s use of the going concern basis of accounting in the preparation of the financial statements.

Based on the audit evidence obtained, the auditor shall conclude whether, in the auditor’s judgment, a material uncertainty exists related to events or conditions that, individually or collectively, may cast significant doubt on the entity’s ability to continue as a going concern. A material uncertainty exists when the magnitude of its potential impact and likelihood of occurrence is such that, in the auditor’s judgment, appropriate disclosure of the nature and implications of the uncertainty is necessary for:

(a) In the case of a fair presentation financial reporting framework, the fair presentation of the financial statements, or

(b) In the case of a compliance framework, the financial statements not to be misleading.

This means that before providing the audit report to the client, the auditor must verify the going concern assumption of the management. The auditor must also ensure that sufficient appropriate audit evidence has been gathered to verify the going concern assumption. Based on this evidence, the auditor can conclude whether any material uncertainty exists related to events or conditions that may challenge the going concern ability of the business.

Step 5 - Obtaining written representations

The audit cannot be completed without obtaining written representations under ISA 580 Written Representations .

Written representations are written statements provided by the management of the business to the auditor to confirm certain matters or to support audit evidence. Before the completion of the audit, the auditor must obtain different written representations from the client business.

The objectives of auditors, per ISA 580 are:

To obtain written representations from management and, where appropriate, those charged with governance that they believe that they have fulfilled their responsibility for the preparation of the financial statements and for the completeness of the information provided to the auditor;

To support other audit evidence relevant to the financial statements or specific assertions in the financial statements by means of written representations if determined necessary by the auditor or required by other ISAs; and

To respond appropriately to written representations provided by management and, where appropriate, those charged with governance, or if management or, where appropriate, those charged with governance do not provide the written representations requested by the auditor.

This means the auditors must obtain written representations from the management and, if necessary, from those charged with governance that regarding their duties when it comes to the preparation of financial statements and providing auditors with complete information.

Furthermore, the auditor is required to obtain written representations for matters relating to the financial statements, if the auditor deems necessary.

ISA 580 also requires the auditors to respond appropriately when a written representation is obtained or when the management or those charged with governance of the client business refuse to provide written representations.

Written representations are dealt with at the end of the audit competition cycle because the standard requires the date of these representations to be close to the date of the audit reports.

Step 6 - Audit clearance meeting

Last but not the least, audit clearance meeting is the final step in an audit completion process. An audit clearance meeting is not required by the International Standards on Accounting. However, these meetings can be used as a final communication channel between the auditors, and the management and those charged with governance of the business.

In addition, this meeting is used as a means to ensure there are no misunderstandings between the two parties regarding the financial statements, the auditor’s report and any other matters.

Matters discussed in a typical audit clearance meeting will include, but are not limited to:

The process of preparation of financial statements.

The adequacy of the internal controls of the business.

Proposed adjustments to the financial statements.

Difficulties encountered by the auditors during the assignment.

Confirmation of the matters to be included in the written representations to be provided by the management.

Confirmation regarding the client’s accounting policies appropriateness.

Details of ethical matters that may need to be clarified with the client.

Final words

When it comes to the completion of an audit, the auditor must plan the completion stage carefully. This is because the completion stage of the audit requires compliance with many different ISAs. The auditor may risk giving an inappropriate opinion if the completion stage is not carried out properly.

If you find this article is helpful and you want to help others too, just share it in any social media (such as Facebook, LindedIn).

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What is a Special Audit? Its Needs and Types

“Uncover the intricacies of Special Audits – focused examinations crucial for organizations. Explore the needs behind conducting them, and delve into various types such as Compliance, Construction, Internal, Cost, Fraud, and more. Understand how these audits address specific areas, ensuring financial transparency and legal compliance.”

An audit that has a narrow focus and only examines one particular aspect of an organization’s operations is called a special audit. This kind of audit may be directed by a government body, but it may also be authorized by any entity or even internally within an organization. In this blog, we discuss the meaning and types of special audits.

Need for special audit

When it is suspected that laws or regulations have been violated in managing & administering the finances of an organization, a special audit becomes necessary. It helps to locate the extent of and reasons for violation.

Apart from that, audits relating to duties, authorizations, responsibilities, and internal control policies, for instance, might also be conducted in addition to the investigation of violations. Further, special audits may also be conducted in instances of bankruptcy or business reorganization.

Who initiates a special audit?

The majority of special audits are initiated by third parties. A tax authority may, for example, demand a corporation to conduct a specific audit to investigate the correctness of income heads and tax calculations. This audit is carried out to increase trust in the numbers and processes in place for the effective and efficient creation of financial reports.

Apart from this, a special audit can also be initiated within a company to dive into any specific area that drives attention or where any discrepancy is suspected. As stated in the preceding paragraphs, it could be related to authorizations, internal controls, business processes, or even more.

Types of special audit

Generally, a special audit is performed to accomplish a specific goal or to check certain facts. Understanding what audit processes are relevant for a given assignment or a given situation would entirely depend on the type of special audit. Each type of audit serves a distinct purpose.

Given below are some examples:

1. Compensation audit: Compensation audit allows for the yearly examination or audit of employee salary, bonus, incentive, and stock option programs in order to assess their efficiency, competitiveness, and legal compliance.

2. Compliance audit: A compliance audit is a type of audit in which the purpose is to evaluate whether or not an organization is following the terms of a contract or certain rules and regulations. Compliance audits may be used by regulatory agencies to determine if a business is in compliance with the requirements of its operating license.

The basic objective of a compliance audit is to evaluate an organization’s conformity to laws, norms, internal bylaws, and codes of conduct.

As far as Indian laws are concerned, an audit that checks compliance with the Companies Act is termed a secretarial audit.

3. Construction audit: A construction audit, as the name implies, is performed to assess the costs of any given construction project. It deals with keeping track of various construction costs such as payments made to suppliers, contractors, and so on. To determine the authenticity of construction expenses, the costs as recorded in the books are compared to the actual papers.

4. Internal audit: An internal audit can be used to evaluate an organization’s performance or the execution of a process against a set of standards, policies, metrics, or guidelines. These audits may include an examination of a company’s internal controls in the areas of corporate governance, accounting, financial reporting, and IT general controls.

5. Cost audit: We all know that an audit involves verification and examination. When this concept of auditing is applied to cost records, it becomes a more specific and specialized form of audit activity. It is named cost audit. A cost audit is an audit of cost records on the utilization of materials, labor, overheads, and other items of cost applicable to the production of goods. It checks whether the cost accounting system followed in the company serves as a correct basis for ascertaining the cost of production.

6. Fraud audit: It is a special form of investigation to identify whether or not there is any fraudulent activity in any particular area of financial statements. Fraud can be done in a variety of ways, including falsifying accounting records, misusing assets, and passing fictional journal entries to conceal fraudulent activities. As a result, if the entity finds that management or officials are involved in fraud, a special audit to investigate such fraud can be undertaken. A fraud audit involves checking any specific area of finance that is likely to be affected.

For example, if a cashier steals cash and escapes, a fraud audit will be conducted to determine how much money was taken away by theft, to carry out a detailed analysis of cash records handled by the cashier, and to investigate the tasks previously performed by the cashier, etc.

7. Information systems audit: An information systems audit is required to ensure that the information systems are running properly and that there are no errors or malfunctions in the system. This particular audit is important for determining whether general controls connected to software development are functioning properly or not. An information systems audit is also performed to assess various controls such as data processing, software applications, IT infrastructure, access to information systems, and so on.

8. Royalty audit: A royalty audit is a financial verification that determines whether a licensee (user of a patent, license, or franchise) is paying the licensor (owner of the patent, license, or franchise) the correct amount of fees that have been agreed upon in the agreement they have in place for use of the patent, license, or franchise.

9. Income Tax audit: The verification of the books of accounts maintained by a taxpayer is referred to as a tax audit. The goal of a tax audit is to validate the taxpayer’s income tax computation in the income tax return and to ensure compliance with the relevant laws of Income Tax. The books of accounts must be audited by a professional Chartered Accountant.

10. GST audit: In terms of indirect tax regulations in India, the Assistant Commissioner of CGST/SGST can initiate a Special Audit under GST [Section 66 of the CGST Act 2017], taking into account the nature and complexity of the case as well as the interest of revenue. If the Assistant Commissioner believes that the value of the taxable supplies disclosed by the registered person is erroneous or that the input tax credit has been improperly claimed, a special audit can be undertaken at any stage of scrutiny/inquiry/investigation.

Wrapping up

Usually, an audit is conducted annually to assess a company’s financial statements by an independent auditor (statutory audit). Besides this audit, some special audits can also be conducted to determine the genuineness of any specific area of operations. It could be to verify compliance with laws, computation of tax, cost records, etc. Although mostly it is ordered by a government authority or third party, it may be initiated internally too.

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Name: Ruchi Gandhi

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Relevant to ACCA Qualification Paper P7 Paper P7, Advanced Audit and Assurance , regularly features questions set in the planning phase of an audit. Effective planning will focus the auditor’s attention on key areas of the audit and ensure that sufficient resources are allocated to the engagement. Planning should result in an audit that is well directed and supervised and ultimately good planning will reduce audit risk. Candidates will benefit from understanding the wider aspects of audit planning, and so this article summarises the main requirements and guidance contained in ISA 300, Planning an Audit of Financial Statements . When does audit planning take place? Naturally, it is reasonable to assume that planning occurs towards the start of an audit engagement. However, according to ISA 300, planning should not be seen as a discrete and separate part of the overall audit. Planning often begins shortly after, or in connection with, the completion of the previous audit, for example, with a review of issues that were discussed with management, such as control deficiencies or unadjusted errors. Such matters are relevant to the next year’s audit and need to be considered when planning. Similarly, the audit plan may be revised as the audit progresses, and should not be viewed as being fixed in place once the main planning phase has ended. For example, a significant event may take place as the audit is in progress, meaning that the audit plan needs to be changed. The nature and extent of planning activities depends on the size and complexity of the audit client, previous experience of the audit firm with the client, and any changes in circumstance that may occur during the audit. Preliminary activities ISA 300 contains a requirement that the auditor shall undertake the following activities at the beginning of the current audit engagement:

Performing procedures regarding the continuance of the client relationship and the specific audit engagement.
Evaluating compliance with relevant ethical requirements, including independence.
Establishing an understanding of the terms of the engagement.

These requirements are also contained in and ISA 220, Quality Control for an Audit of Financial Statements and ISA 210, Agreeing the Terms of Audit Engagements and remind us that planning is a wider activity than just obtaining understanding of the business and performing risk assessment. Audit strategy and audit plan ISA 300 states that audit planning activities should:

establish the overall audit strategy for the engagement
develop an audit plan.

Audit strategy The audit strategy sets out in general terms how the audit is to be conducted and sets the scope, timing and direction of the audit. The audit strategy then guides the development of the audit plan, which contains the detailed responses to the auditor’s risk assessment. An underpinning principle of audit planning under the Clarified ISAs is that the audit plan should contain detailed responses to the specific risks identified from obtaining an understanding of the audited entity. ISA 300 requires the auditor to consider specific matters when establishing the audit strategy, and provides a list of typical matters to be considered in its appendix. These matters are discussed below. Identify the characteristics o f the engagement that define its scope Some audit engagements have specific characteristics that mean the audit has a wider scope than the audit of other entities. For example, a group audit engagement or the audit of a multinational company will both have wider scopes than an audit of a small, owner-managed entity. Matters such as the ability to use the work of internal auditors, the need to liaise with external service organisations, and the effect of IT on audit procedures are also relevant. The scope is also affected by the applicable financial reporting framework, the nature of the audited entity’s business and whether it operates business segments, the business activities conducted, and the availability of client personnel and data. Ascertain the reporting objectives of the engagement to plan the timing of the audit and the nature of the communications required Reporting requirements will vary from audit to audit. For example, some entities have additional reporting requirements to comply with corporate governance regulations or industry requirements, and the auditor must understand these requirements from the start of the audit. The nature of other communications that may be necessary during the audit should be considered, such as liaison with component auditors, and communications to management and to those charged with governance. Consider the factors that are significant in directing the audit team’s efforts in the auditor’s professional judgment The strategy must consider issues to do with quality control, such as how resources are managed, directed and supervised, when team briefing and debriefing meetings are expected to be held, how engagement partner and manager reviews are expected to take place (for example, on-site or off-site), and whether to complete engagement quality control reviews. Consider the results of preliminary engagement activities and knowledge gained on other engagements This includes the initial assessments of materiality, risks identified from preliminary activities such as fraud risks, significant events that have occurred at the entity or in the industry in which it operates since the last audit, and the results of previous audits that involved evaluating the operating effectiveness of internal control, including the nature of identified deficiencies and action taken to address them. The audit firm may also have performed other services for the client that may be relevant in determining the audit strategy, for example, reviews of business plans or cash flow forecasts. Ascertain the nature, timing and extent of resources necessary to perform the engagement One of the main objectives of developing the audit strategy is to effectively allocate resources to the audit team, for example, the use of specialists on particular areas of the audit, or building a team of highly experienced auditors for a potentially high-risk audit engagement. If the audit is time pressured due a tight deadline, then more resources will need to be allocated to ensure that all necessary audit work is completed, and can be reviewed in time to meet the deadline. Audit plan ISA 300 states that once the overall audit strategy has been established, an audit plan can be developed to address the various matters identified in the overall audit strategy, taking in to account the need to achieve the audit objectives through the efficient use of the auditor’s resources. The establishment of the overall audit strategy and the detailed audit plan are not necessarily discrete or sequential processes, but are closely interrelated since changes in one may result in consequential changes to the other. Therefore it is not necessarily the case that the audit strategy is prepared and completed before the audit plan is devised, and in practice it is typical for the two to be developed together. The audit plan is a detailed programme giving instructions as to how each area of the audit will be conducted. In other words, the audit plan details the specific procedures to be carried out to implement the strategy and complete the audit. ISA 300 provides guidance on what should be included in the audit plan, stating that the audit plan should describe:

the nature, timing and extent of planned risk assessment procedures
the nature, timing and extent of planned further audit procedures at the assertion level
other planned audit procedures that are required to be carried out so that the engagement complies with ISAs.

Typically an audit plan will include sections dealing with business understanding, risk assessment procedures, planned audit procedures ie the responses to the risks identified and other mandatory audit procedures. Changes to the audit strategy and audit plan The audit strategy and audit plan are not fixed once the planning stage of the audit is complete. It is important that both are updated and changed as necessary as the audit progresses. For example, as a result of unexpected events, or changes in conditions, the auditor may need to modify the overall audit strategy and audit plan and thereby the resulting planned nature, timing and extent of further audit procedures, based on the revised consideration of assessed risks. This may be the case when information comes to the auditor’s attention that differs significantly from the information available when the auditor planned the audit procedures, for example, an event may take place after audit planning has been initially completed which creates doubt over going concern. Or, as a result of performing planned audit procedures additional information may come to light which may lead the auditor to amend initial risk assessment, or level of performance materiality, for all, or part, of the audit. Documentation ISA 300 requires that as well as the audit strategy and audit plan being thoroughly documented, a record of significant changes made to the audit strategy and audit plan is needed. Documentation is crucial, because key decisions about how the audit will be performed are contained in the audit strategy and audit plan. The documentation should therefore include the response made by the auditor to any significant changes that occur during the audit, as discussed above. The audit strategy and audit plan do not need to be documented in a particular way. Some audit firms use memoranda, others checklists. Some use standardised documentation such as standardised audit programmes while others tailor the specific form of the documentation to each audit engagement. The form of the documentation does not matter as long as it provides a clear record of how the audit was planned. Direction, supervision and review ISA 300 requires that the auditor shall plan the nature, timing and extent of direction and supervision of engagement team members and the review of their work. It is crucial that the audit plan includes the detail as to how supervision and review should be conducted during the audit, in order to perform a high quality audit. Inadequate supervision and review can lead to the audit team making errors, for example, selecting inappropriate items for sampling, or failing to properly conclude on audit procedures performed. The amount of detail included in the audit plan in relation to supervision and review will depend on factors such as the size and complexity of the entity being audited, the assessed risk of material misstatement, and the capabilities and competence of the audit team members. Additional considerations in initial audit engagements The final section of ISA 300 relates to initial audit engagements, and requires the auditor to perform client and engagement acceptance procedures (as also required by ISA 220), and also to communicate with the predecessor auditor, where there has been a change of auditors, in compliance with relevant ethical requirements. The ISA recognises that for an initial audit engagement, the auditor may need to expand the planning activities because the auditor does not ordinarily have the previous experience with the entity that is considered when planning recurring engagements. Conclusion Planning an audit involves more than just obtaining business understanding and performing risk assessment. Planning is a dynamic process that may evolve during the audit, and should always respond to changes in the circumstances of the audited entity. Adherence to the requirements of ISA 300 should result in a well-focused audit, staffed by appropriate personnel, performing relevant and appropriate audit procedures. Written by a member of the Paper P7 examining team

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A Step-by-Step Guide to Crafting an Assignment on Auditing and Assurance

In the world of accounting and finance, auditing and assurance are essential elements that guarantee the veracity and accuracy of financial information. You might encounter various assignments as a finance student that require you to delve into the intricacies of assurance and auditing. These assignments help you develop your analytical and critical thinking abilities while also testing how well you understand the material. To help you submit a well-organized and insightful piece of work, we will walk you through the process of writing a thorough assignment to do auditing and assurance homework in this blog. You will learn how to review assignment guidelines, gather pertinent materials, take organized notes, and effectively structure your assignment by following the procedures described in this guide. We'll look at the theoretical underpinnings of auditing and assurance, talk about the various kinds of auditing and assurance homework, and give some insights into the auditing procedure. We'll also talk about the difficulties and moral dilemmas that auditing and assurance professionals face, emphasizing the value of professional ethics and the most recent developments in the industry. You will have the information and resources required to produce and complete your assignment on auditing and assurance by the blog's conclusion.

Understanding Auditing and Assurance

Let's establish a firm understanding of the concepts of assurance and auditing before we begin the assignment writing process. An organization's financial records, transactions, and internal controls are systematically examined and evaluated during an audit to make sure they are accurate, fair, and in compliance with all applicable laws. External auditors are frequently impartial experts who have been hired to conduct this assessment and offer a dispassionate opinion on the company's financial statements. On the other hand, assurance is a more comprehensive idea that goes beyond auditing and encompasses it. It includes a range of services, including attestation, reviews, and agreed-upon procedures, where an impartial expert assesses and offers assurance on various elements of financial data or operational procedures. As you begin writing your assignment, you must comprehend the differences between auditing and assurance. It enables you to comprehend the breadth and importance of each concept and successfully meet the requirements of the assignment. Having established this foundation, let's move on to the assignment writing process and investigate the essential steps to produce a properly organized and insightful piece of work.

Definition of Auditing

The goal of auditing is to verify the accuracy, fairness, and compliance with applicable laws of an organization's financial records, transactions, and internal controls. To evaluate the accuracy and integrity of financial information, a thorough analysis of financial statements, supporting materials, and accounting practices is required. Usually, external auditors, who are independent and impartial experts, are hired to conduct this assessment and offer an unbiased opinion on the company's financial statements. Organizations can be certain that their financial statements accurately reflect their financial position, performance, and cash flows by having them audited.

Definition of Assurance

Auditing is a subset of the larger concept of assurance, which goes beyond it. It includes a range of services like attestation, reviews, and established protocols. Independent experts evaluate and offer assurance on various facets of financial information or operational processes as part of assurance engagements. Assurance services go beyond the review of financial records, while auditing focuses on the verification of financial statements. They also consist of non-financial elements like risk assessment, process evaluation, performance measurement, and others. Engagements in assurance assure stakeholders that information beyond financial statements is trustworthy, credible, and transparent.

Key Differences Between Auditing and Assurance

Although auditing and assurance are similar, their scopes and objectives are different. Through an unbiased assessment of an organization's financial records, auditing primarily focuses on confirming the veracity of financial statements. It guarantees adherence to accounting rules, laws, and regulations. Contrarily, assurance covers a wider range of services beyond the simple verification of financial statements. It entails assessing risks, giving assurance regarding operational procedures, and judging the accuracy of non-financial data. Internal controls, sustainability reporting, regulatory compliance, and performance measurement are some examples of topics that can be covered by assurance engagements. Although assurance includes auditing as a subset, assurance services go beyond financial reporting to give confidence in a variety of organizational operations.

Preparing for the Assignment

Thorough planning is essential for a successful assignment on auditing and assurance. You can prepare for your assignment effectively by following the steps below. First and foremost, carefully read the instructions for the assignment that your teacher has provided. It's essential to comprehend the precise issues or subjects you must deal with as well as any format or citation requirements. Then, compile pertinent information by conducting in-depth research with the aid of scholarly journals, books, and reliable online sources. You will gain a thorough understanding of the subject matter as a result. Take detailed notes as you conduct your research to remember key ideas, quotations, and sources. The writing process will be streamlined as a result, and your assignment's structure will be simpler. Consider outlining as well to structure your ideas and guarantee a logical flow of ideas in your assignment. You will lay a strong foundation for writing an informed and coherent assignment on auditing and assurance by adhering to these pre-writing steps.

Review the Assignment Guidelines

It is crucial to carefully read the instructions provided by your instructor before beginning your assignment on auditing and assurance. Spend some time carefully reading and comprehending the directions, noting any particular questions or subjects you need to cover. Be mindful of the formatting specifications, including the need for margins, font size, and citation style. You can make sure that your assignment satisfies the requirements and addresses the particular areas of focus specified by your instructor by being aware of the rules upfront.

Gather Relevant Materials

Conducting thorough research is essential to producing a well-informed assignment. Make use of a range of resources, including scholarly journals, books, reliable websites, and trade publications. assemble trustworthy and pertinent resources that offer in-depth insights into the field of assurance and auditing. To ensure the accuracy of the information you use in your assignment, keep in mind to critically evaluate the credibility and dependability of each source.

Take Notes and Organize the Information

Organizing your notes will help you remember important ideas, quotations, and sources as you conduct your research. Whether you choose to use digital note-taking tools or conventional pen and paper, come up with a system that works for you. Make sure to meticulously note important details from your sources, such as author names, publication dates, and page numbers. By keeping your notes organized, you can structure your assignment more easily and avoid confusion or plagiarism concerns when citing sources.

Structuring Your Assignment

To present your ideas coherently and logically, it is essential to structure your assignment on auditing and assurance. You can create an assignment that is well-organized by using the following framework. Start by giving a brief overview of auditing and assurance, their importance, and the goal of your assignment in an interesting introduction. Discuss the theoretical underpinnings of auditing and assurance after the introduction, paying particular attention to important terms like materiality, independence, audit risk, and professional skepticism. Continue by describing the various auditing and assurance services, using appropriate examples, such as financial statement audits, operational audits, compliance audits, and review engagements. The auditing procedure should then be described in detail, including each step from planning and risk assessment to assembling evidence and arriving at a conclusion. Consider including a section on the difficulties and moral issues that arise in auditing and assurance, such as professional ethics, ongoing problems, and new trends. Finish your assignment by reiterating the most important ideas. By following this format, you will produce a well-organized assignment that thoroughly explores the subject of auditing and assurance.

Professional Ethics and Code of Conduct

Professional ethics are crucial for maintaining integrity, trust, and public confidence in the fields of auditing and assurance. Describe the role that professional ethics play in maintaining the veracity and accuracy of financial information. The International Ethics Standards Board for Accountants (IESBA) and the American Institute of Certified Public Accountants (AICPA) are two well-known professional organizations that have established high ethical standards. Investigate issues like impartiality, discretion, and professional competence. Emphasize the moral dilemmas that auditors might face and the ethical frameworks for making decisions. In the practice of auditing and assurance, emphasize the importance of adhering to a strict code of conduct and upholding high ethical standards.

Current Issues and Emerging Trends

Practises for auditing and assurance are constantly changing to address new issues and keep up with emerging trends. Highlight the most important current problems and new developments in the industry. Talk about how technology, including data analytics and artificial intelligence, has affected auditing procedures. Learn how technology is being used by auditors to improve efficiency, accuracy, and risk assessment. What role do auditors play in assessing and ensuring the accuracy of environmental, social, and governance (ESG) disclosures? Discuss the rising importance of sustainability reporting. Discuss how auditors are evolving in their ability to spot and stop fraud, financial irregularities, and cybersecurity risks. Your assignment will demonstrate a modern understanding of the dynamic auditing and assurance landscape by addressing these current issues and emerging trends.

Challenges and Ethical Considerations in Auditing and Assurance

Professionals in auditing and assurance face a variety of obstacles and moral quandaries in their work. These issues must be covered in your assignment. Talk about typical difficulties like auditing complicated financial instruments, handling client privacy issues, and preserving independence and objectivity. Describe any challenges auditors might encounter when determining the risk involved in complex financial transactions or juggling confidentiality issues when handling private client information. In addition, stress the value of maintaining ethical standards in assurance and auditing. Investigate subjects like business ethics, regulatory organizations' codes of conduct, and the value of professional skepticism. By addressing these issues and ethical concerns in your assignment, you will show that you have a thorough understanding of the complexities that exist in the auditing and assurance industry as well as your capacity for critical analysis and issue evaluation.

In conclusion, writing an assignment on auditing and assurance necessitates having a firm grasp of the material, meticulous planning, and adherence to ethical standards. You can create a well-organized and insightful assignment that demonstrates your knowledge and critical thinking abilities by following the instructions provided in this guide. Before beginning the writing process, don't forget to read the assignment instructions, gather pertinent materials, and organize your thoughts. Take into account the value of professional ethics as well as the changing auditing and assurance industry, including present problems and future trends. Your assignment will show that you are knowledgeable in the subject by addressing these important factors and will advance both your academic and professional careers. Therefore, approach this assignment with confidence and produce an outstanding piece of work on auditing and assurance.

Single Audits: Improving Federal Audit Clearinghouse Information and Usability Could Strengthen Federal Award Oversight

Federal award amounts distributed to recipients have increased substantially since the onset of the COVID-19 pandemic.

If an award recipient spends $750,000 or more in federal funds in a year, it must undergo an audit of its award spending. The results of this "single audit" must be submitted to the Federal Audit Clearinghouse, which is maintained by the General Services Administration.

We found issues with the quality and completeness of the data in this clearinghouse. For example, the clearinghouse can't identify recipients that are required to submit a single audit but didn't.

We recommended , among other things, that GSA address this issue.

What GAO Found

The Single Audit Act requires nonfederal entities that spend $750,000 or more in federal awards in a year to undergo a single audit, which is an audit of an entity's financial statements and federal awards, or in select cases a program-specific audit, and submit the results to the Federal Audit Clearinghouse (FAC). The U.S. Census Bureau maintained the FAC until October 2023, when the Office of Management and Budget (OMB) designated the General Services Administration (GSA) to assume responsibilities.

GAO identified some issues with FAC processes that affect the reliability and usefulness of single audit information. For example, the FAC currently cannot identify recipients that should have submitted a single audit but did not. As a result, federal agencies may not have all the data they need to conduct oversight. In addition, OMB has not designated an entity to conduct a government-wide single audit quality review since 2007. Given the trillions of dollars of COVID-19-related financial assistance provided in recent years, a government-wide review is increasingly important to help identify issues in the quality of single audits that can lead to unreliable FAC information.

GAO also found that $1.17 trillion of the reported $6.97 trillion of direct federal award funds spent by recipients from 2017 through 2021 were linked to single audit findings that were both severe (contributed to an auditor's modified opinion or material weakness) and persistent (repeated over multiple years).

Severity and Persistence of Single Audit Findings by Direct Expenditure of Federal Awards, 2017-2021

Note: Numbers may not sum due to rounding. For more details, see fig. 4 in GAO-24-106173.

These findings were also related to $69 billion of COVID-19 relief funds spent from 2020 to 2021. GAO identified 213 findings reported in 2015 or earlier that remained unresolved in 2021.

Why GAO Did This Study

Federal award amounts distributed to recipients have increased substantially since the onset of the COVID-19 pandemic. For fiscal year 2023, $1.1 trillion of awards were distributed and about 40,000 single audits were submitted to the FAC. Single audits are an important tool to help ensure that award recipients are complying with the requirements of their awards.

The CARES Act includes a provision for GAO to conduct oversight of funds made available to respond to the COVID-19 pandemic. This report examines (1) FAC data reliability for oversight purposes, including oversight of COVID-19 relief funding; (2) processes involved in using and overseeing the FAC; and (3) the extent to which federal award expenditures were linked to severe and persistent single audit findings reported in the FAC.

GAO analyzed FAC data from 2015 through 2021 (the most recent complete data available at the time of review). GAO interviewed selected federal agencies and audit community members about their use of the FAC.

Recommendations

GAO is recommending three matters for Congress to consider, including amending the Single Audit Act to require OMB to initiate a government-wide single audit quality review at a regular interval.

GAO is making 10 recommendations, including four to GSA and six to OMB, to implement guidance and other strategies to further enhance the use and oversight of the FAC. GSA and OMB agreed with GAO's recommendations to them.

Matter for Congressional Consideration

Recommendations for executive action, full report, gao contacts.

James R. Dalkin Director [email protected] (202) 512-3133

Taka Ariga Chief Data Scientist and Director of the Innovation Lab [email protected] (202) 512-6888

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Chuck Young Managing Director [email protected] (202) 512-4800

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Internal Auditor (IA): Definition, Process, and Example

Daniel Liberto is a journalist with over 10 years of experience working with publications such as the Financial Times, The Independent, and Investors Chronicle.

Investopedia / Yurle Villegas

What Is an Internal Auditor (IA)?

An internal auditor (IA) is a trained professional employed by companies to provide independent and objective evaluations of financial and operational business activities , including corporate governance . They are tasked with ensuring that companies comply with laws and regulations, follow proper procedures, and function as efficiently as possible.

Key Takeaways

An internal auditor (IA) is a trained professional tasked with providing independent and objective evaluations of company financial and operational business activities.
They are employed to ensure that companies follow proper procedures and function efficiently.
Final reports are presented to senior management and can include recommendations.

Understanding an Internal Auditor (IA)

The main job of an internal auditor (IA) is to identify problems and correct them before they are discovered during an external audit by an outside firm or regulatory agencies, such as the Securities and Exchange Commission (SEC). One of the roles of the SEC is to regulate how companies report their financial statements to help ensure that investors have access to all of the necessary information before investing.

An internal audit generally performs the three tasks outlined below.

Assess any risks and the internal controls within a company
Ensure that a company and its employees are in compliance with federal and state laws and regulations
Make suggestions as to what needs to be done to rectify a failed audit or issues that were identified as problematic during the audit

Internal Auditing Process

To achieve this goal, internal auditors will typically perform a multitude of tasks, including examining financial statements, expense reports, inventory , financial data, budgeting and accounting practices, as well as creating risk assessments for each department. Detailed notes are taken, interviews with employees are conducted, work schedules are supervised, physical assets are verified, and financial statements are scrutinized to eliminate potentially damaging errors or falsehoods and find ways to boost productivity.

Once an internal auditor has completed the examination, the findings are presented in a formal report. The audit report describes how the audit was done, what it discovered and, if necessary, suggestions for what improvements could be made. It is usually presented to senior executives at the company. If changes are recommended, it's common for an internal auditor to be asked to complete a follow-up audit to determine how well the advised changes have been executed.

Properly-managed publicly-traded companies also carry out internal audits to ensure that the company is complying with federal and state regulations, including those mandated by the SEC. However, companies must also ensure that their accounting practices follow the accounting guidelines as laid out by the Generally Accepted Accounting Principles (GAAP).

Requirements for Internal Auditors

The Institute of Internal Auditors (IIA), established in 1941 and headquartered in Florida, is the international professional organization that sets standards , guidance, best practices, and code of ethics for practitioners. On its website , the IIA defines internal auditing as: “an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management , control , and governance processes.”

Internal Auditor vs. External Auditor

Sometimes the role of internal and external auditors can be confused. The main difference between the two is that internal auditors (IA) work on behalf of company management. Internal auditors are hired by the company, while external auditors are appointed by a shareholder vote.

Internal auditors are employed to educate management and staff about how the business can function better. External auditors, on the other hand, have no such obligations. They are responsible for reviewing financial statements to ensure that they are accurate and conform to GAAP. Their findings are then reported back to shareholders, rather than management.

According to the Association of Certified Fraud Examiners, the role of the external auditor is to: “inspect clients’ accounting records and express an opinion as to whether financial statements are presented fairly in accordance with the applicable accounting standards of the entity, such as Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS). They must assert whether financial statements are free of material misstatement, whether due to error or fraud.”

It is a legal requirement for all financial statements from public companies to be audited by a third-party accountant, in accordance with the Securities Act of 1933 and the Securities Exchange Act of 1934 .

Benefits of an Internal Auditor (IA)

Many companies choose to employ an internal auditor, despite not being legally obligated to do so. Robust internal audits are viewed as a key way to correct issues quickly, maintain a good reputation, and prevent money from being wasted. Reports filed by internal auditors (IA) can help companies to prosper and operate at maximum efficiency. Internal auditors also set the company up for success when it's annual external audit comes around. The job of an internal auditor is essentially to help catch and fix issues before an external auditor has the chance to so do. For this reason, many executives view them as a necessary expense.

Institute of Internal Auditors. " About the IIA ." Accessed Sept. 7, 2020.

Association of Certified Fraud Examiners. " External Auditor ." Accessed Sept. 7, 2020.

Government Publishing Office. " Securities Exchange Act of 1934 ," Page 91. Accessed Sept. 7, 2020.

Government Publishing Office. " Securities Act of 1933 ," Page 72. Accessed Sept. 7, 2020.

Securities and Exchange Commission. " All About Auditors: What Investors Need to Know ." Accessed Sept. 7, 2020.

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Man or bear? Hypothetical question sparks conversation about women's safety

Women explain why they would feel safer encountering a bear in the forest than a man they didn't know. the hypothetical has sparked a broader discussion about why women fear men..

If you were alone in the woods, would you rather encounter a bear or a man? Answers to that hypothetical question have sparked an ongoing and debate about why the vast majority say they would feel more comfortable choosing a bear.

The topic has been hotly discussed for weeks, with men and women everywhere chiming in with their thoughts all over social media.

Screenshot HQ , a TikTok account, started the conversation, asking half a dozen women whether they would rather run into a man they didn't know or a bear in the forest. Out of the seven women interviewed for the piece, only one picked a man.

"Bear. Man is scary," one of the women responds.

A number of women echoed the responses given in the original video, writing in the comments that they, too, would pick a bear over a man. The hypothetical has people split, with some expressing their sadness over the state of the world and others cracking jokes about the situation. Some men are flabbergasted.

Here's what we know.

A bear is the safer choice, no doubt about it, many say

There were a lot of responses, over 65,000 to be exact, under the original post, with many writing that they understood why the women would choose a bear.

"No one’s gonna ask me if I led the bear on or give me a pamphlet on bear attack prevention tips," @celestiallystunning wrote.

@Brennduhh wrote: "When I die leave my body in the woods, the wolves will be gentler than any man."

"I know a bear's intentions," another woman wrote. "I don't know a man's intentions. no matter how nice they are."

Other TikTok users took it one step farther, posing the hypothetical question to loved ones. Meredith Steele, who goes by @babiesofsteele , asked her husband last week whether he would rather have their daughter encounter a bear or a man in the woods. Her husband said he "didn't like either option," but said he was leaning toward the bear.

"Maybe it's a friendly bear," he says.

Diana, another TikTok user , asked her sister-in-law what she would choose and was left speechless.

"I asked her the question, you know, just for giggles. She was like, 'You know, I would rather it be a bear because if the bear attacks me, and I make it out of the woods, everybody’s gonna believe me and have sympathy for me," she said. "But if a man attacks me and I make it out, I’m gonna spend my whole life trying to get people to believe me and have sympathy for me.'"

Bear vs. man debate stirs the pot, woman and some men at odds

The hypothetical has caused some tension, with some women arguing that men will never truly understand what it's like to be a woman, or the inherent dangers at play.

Social media users answered this question for themselves, producing memes, spoken word poetry and skits in the days and weeks since.

So, what would you choose?

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Twins Designate Matt Bowman For Assignment

By Darragh McDonald | April 30, 2024 at 2:00pm CDT

The Twins announced that right-hander Jhoan Duran has been reinstated from the injured list, as had been reported on earlier this week. In a corresponding move, right-hander Matt Bowman has been designated for assignment.

Bowman, 33 next month, signed a minor league deal with the Twins in the offseason. He was added to the 40-man roster just over two weeks ago, after throwing six scoreless frames in Triple-A, and has since pitched 7 2/3 innings over five appearances in the majors.

He only allowed two earned runs in that time, which is why his earned run average looks nice right now at 2.35. However, the underlying metrics have been less impressive. He has six strikeouts and four walks, leading to respective rates of 19.4% and 12.9% thus far. His 57.9% ground ball rate is strong but he wasn’t going to maintain a .056 batting average on balls in play nor a 90.9% strand rate. That’s why his 5.64 FIP and 4.38 SIERA are much higher than his ERA in this small sample.

Since Bowman is out of options, the Twins had to remove him from the 40-man roster entirely in order to open an active roster spot for Duran. They will now have one week to trade Bowman or pass him through waivers. If the latter scenario were to come to pass, he has over three years of service time, giving him the right to reject an outright assignment and elect free agency instead. However, he doesn’t have five years of service, meaning he would have to forfeit the remainder of this $925K salary to return to the open market.

Elbow injuries, including Tommy John surgery, prevented Bowman from pitching in official game action from 2020 to 2022. He was able to return to the mound last year, tossing 58 2/3 innings for the Triple-A club of the Yankees with a 3.99 ERA. He struck out 22.6% of batters faced in that time while giving out walks at an 11.7% rate and getting grounders at an 51.9% clip. He also tossed four innings for the Yanks in the majors but was outrighted after the season, which allowed him to sign with the Twins.

12 Comments

What’s his assignment?

Free to a good home. Kidding on that of course, but lots being left out with regards to this guy last few days on this site. Something has been going on behind the scenes regarding him.

Team doesn’t just DFA a cheaply controlled, 26yo closer, who happens to dominate 2y straight, sit 100+mph, coming back from injury (now) or not who still has an option year.

no.. there has to be at least 1 serious wart with this guy. Twins fans might know, some hardcore fans of theirs.

Was wondering the same thing.. makes no sense to DFA this guy.

Who, Bowman? Are people reading this way different than I am?

Matt Bowman is a 4A reliever ever since Mike Matheny destroyed his arm from 2016-2017. He had bad peripheral numbers that were prime for regression

I watched the guy this year. Great break on his stuff. I think it just comes down to this – our bullpen is stacked. Justin Topa is due to finish rehab soon too.

Sure they do, it’s the entire point of the 40 man roster. The Twins used him to cover a short term need brought on when several of their MLB-ready relievers went on the DL at the same time. Instead of bringing up someone who was not ready they added a throw-away guy who they could try to pass back through waivers rather than risk losing someone younger they care about, like Festa for example.

Also, Bowman is not the guy you’re describing, which is why he was freely available last winter. He could definitely be an improvement for a lot of bad bullpens, so I expect he’ll be grabbed (Hello Chicago!) but better him than one of the youngsters they don’t want to start the clock on.

You do realize they are DFA-ing Bowman, not Duran, right?