Statement of work for financial audit services procurement

Financial Audit SOW

Financial Audit Statement of Work

The objectives of this work order is for the contractor to express an opinion on the fairness in which the financial statements are fairly presented, in all material aspects, financial position, results of operations, and cash flows in conformity with generally accepted accounting principles (Arens, 2006).

P.1.1. The requirements of this work order include testing of internal controls, examining the accuracy of the financial statements, examining whether financial statements are in compliance with GAAP and SOX regulations, as well as examining whether the business is capable of "going concern" quality.

The testing of internal controls should include examining company policies, human resource records, and testing the information system, more especially in the area of bookkeeping, for the quality of internal control to examine the adequacy and risks associated with the internal controls (Codjia). The emphasis should be on rules when employees record and report operating data, accounting policies, internal controls in the bookkeeping processes, and financial reporting mechanisms. For the financial statements, doing audit trails to ensure that transactions are in compliance with generally accepted accounting principles and the Sarbanes-Oxley Act of 1934. This would also include the financial position, results of operations, and cash flows to ensure they are fairly stated. Fraud should also be examined as it affects the validity of the financial statements and financial position of the business. Inventory should be inspected to ensure the validity of the inventory balance in the balance sheet.

All personnel working on the audit should have accounting and auditing skills and attributes, such as independence, and follow the AICPA code of conduct (Auditing Standards). Personnel should maintain a questioning attitude (Setting up the audit committee).