Auditing is a process where all accounts of the school are examined and evaluated in detail by a competent auditor in order to determine and report on the financial standing of the school for the period under review. A school audit of financial statements also establishes the credibility of the accounting records as specified in the statutory accounting principles and practices. The auditor officially examines and verifies the books of accounts and writes a final report which gives a true and fair view of the financial status of the school. It should also show that state/federal funds were spent in keeping with legal requirements. (Townley & Ramirez, p. 113).
Does an "unqualified" audit mean there is no fraud?
Once the books of accounts have been examined and verified, the findings reflect the fact that the financial transactions were made and recorded according to accepted principles and practices. An unqualified opinion is issued when the independent auditor believes that the company's financial statements are sound; that is, the statements are free from material misstatements. This is different from a qualified opinion which is issued when the independent auditor discovers something in the financial statements that is subject to major concern.
Modesto City Schools Audit Report:
"In planning and performing our audit of the financial statements, we considered Modesto City Schools' internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of Modesto City Schools' internal control. Accordingly, we do not express an opinion on the effectiveness of Modesto City Schools' internal control"
Works Cited
Townley, A., & Ramirez, J. (2012). School finance: A California perspective (9th ed.). Dubuque, Iowa: Kendall/Hunt Pub.
Does an "unqualified" audit mean there is no fraud?
Once the books of accounts have been examined and verified, the findings reflect the fact that the financial transactions were made and recorded according to accepted principles and practices. An unqualified opinion is issued when the independent auditor believes that the company's financial statements are sound; that is, the statements are free from material misstatements. This is different from a qualified opinion which is issued when the independent auditor discovers something in the financial statements that is subject to major concern.
Modesto City Schools Audit Report:
"In planning and performing our audit of the financial statements, we considered Modesto City Schools' internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of Modesto City Schools' internal control. Accordingly, we do not express an opinion on the effectiveness of Modesto City Schools' internal control"
Works Cited
Townley, A., & Ramirez, J. (2012). School finance: A California perspective (9th ed.). Dubuque, Iowa: Kendall/Hunt Pub.