Auditing in Systems Perspective.

Abstract This article focuses on auditing. Auditors have always used their professional judgment when confronted with attestation problems. Surprisingly, however, studies of the application of audit judgment as a cognitive information processing problem are nonexistent. In fact, even the important and all-pervasive materiality concept remains subject to a good deal of debate, and the generally accepted accounting principles can no longer be considered as sufficient decision criteria for audit judgments. Nevertheless, all these discussions and recent attempts to identify a set of criteria that have been used by auditors in grading their opinions represent important contributions towards the needed understanding and explanation of the audit judgment processes. A Statement of Basic Auditing Concepts recognizes auditing as a purposeful human activity and contains a methodological foundation of auditing which supports further important conceptual and operational extensions towards an information processing theory of auditing.