Video: Audit Committee

In this lesson, the concept of the audit committee is discussed. The audit committee is responsible for ensuring that the financial statements are accurate and comply with accounting standards. This committee consists of members from the board of directors, and they are in charge of selecting and appointing the independent auditors, resolving disagreements between the auditor and management, and reviewing the scope of the audit. A distinction is made between the roles of the board of directors and senior management. The lesson also briefly mentions the Accounting Standards Board (ASB) and the American Institute of Public Accountants (AICPA) and their responsibilities in setting accounting standards and serving as a membership organization for accountants. Additionally, the Statements on Auditing Standards (SAS) are introduced as authoritative guidance for auditors.