Demonstrating Professional Skepticism Essay Example | Topics and Well Written Essays - 500 words

Demonstrating Professional Skepticism - Essay Example Boyle et al. (2015) observe that the failure on the part of the auditors to exercise professional skepticism when conducting the audit of financial statements imposes costs on the shareholders and other stakeholders. When fraud fails to be recognized, the shareholders are the net losers. The article points to the application of professional skepticism in audit engagements as being the solution to the increased number of audit failures and deficiencies. Professional skepticism has become a matter of critical importance to the profession of auditing given the increased complexity of the audit environment (Boyle et al. 5). The article explains that the exercise of professional skepticism by the auditors is in line with the requirements of the Statements on Auditing Standards 1 (SAS1) (Boyle et al. 5). The standard on auditing requires that the auditors must apply due care with an emphasis on the exercise of professional skepticism as part of the auditor responsibilities and functions. T he role of professional skepticism in the consideration of fraud in the audit of financial statements is analyzed with a proper discussion and relation of the elements of skepticism to the audit (Boyle et al. 6). Boyle et al. (2015) explain that professional skepticism is an attitude that involves a critical assessment and analysis of audit evidence and a questioning mind. It is this questioning mindset that enhances the possibilities of recognizing fraud with less attention to experience.