TABLE OF CONTENTS

Page
Introduction 2
Chapter 1: Research Proposa !
Chapter 2: Research in Theor" #
Chapter !: $i%%erences &et'een pro%it and nonpro%it organi(ations 1)
Chapter *: Pre+ious Studies , Inter+ie's 'ith the Auditors !1
Chapter -: Resuts And Reco..endations */
Re%erences -1
1
Introduction Introduction
Since Many Years, Man was doing his work and make its accounts Since Many Years, Man was doing his work and make its accounts
without the knowledge that reliable on ,But with the development of without the knowledge that reliable on ,But with the development of
science and technology And the spread of trade across the world It has science and technology And the spread of trade across the world It has
become necessary and important to find the science of financial become necessary and important to find the science of financial
operations that made every second. operations that made every second.
After the creation of accounting science the development of trade and the After the creation of accounting science the development of trade and the
spread of companies across the world and the presence of multinational spread of companies across the world and the presence of multinational
companies therefore, accounting is no longer enough alone, so the eperts companies therefore, accounting is no longer enough alone, so the eperts
decides to find a complement to the science of accounting which is called decides to find a complement to the science of accounting which is called
Auditing. Auditing.
Audit is an Audit is an eamination eamination and and verification verification of a of a company!s company!s financial financial and and
accounting records accounting records and and supporting documents supporting documents by a by a professional professional, such as a , such as a
"ertified #ublic Accountant "ertified #ublic Accountant. .
Auditing become the first science that make the owner and the donor feel Auditing become the first science that make the owner and the donor feel
safety when he see the signature of the eternal auditor on audit report. safety when he see the signature of the eternal auditor on audit report.
In $his %esearch we decide to eamine an important issue in the audit In $his %esearch we decide to eamine an important issue in the audit
which is & "omparative Study Between Audit 'n #rofit 'rgani(ations which is & "omparative Study Between Audit 'n #rofit 'rgani(ations
And Audit 'n )on*profit 'rgani(ations. & And Audit 'n )on*profit 'rgani(ations. &
+inally ,,e hope Allah $he Success In +inally ,,e hope Allah $he Success In
2
Chapter 1: Research Proposa Chapter 1: Research Proposa
Research Tite : Research Tite :
"omparative Study Between Audit 'n #rofit 'rgani(ations And Audit "omparative Study Between Audit 'n #rofit 'rgani(ations And Audit
'n )on*profit 'rgani(ations. 'n )on*profit 'rgani(ations.
Research Pro&e.: Research Pro&e.:
,hen many people talk about audit they forgot an important type of audit ,hen many people talk about audit they forgot an important type of audit
which is audit on non*profit organi(ations, may be some of them think which is audit on non*profit organi(ations, may be some of them think
that there is no difference between audit on profit and nonprofit that there is no difference between audit on profit and nonprofit
organi(ations and others don!t know the main differences so we decide to organi(ations and others don!t know the main differences so we decide to
discuss this. discuss this.
&Is $here Any -ifference Between Audit 'n #rofit 'rgani(ations And &Is $here Any -ifference Between Audit 'n #rofit 'rgani(ations And
Audit 'n )on*profit 'rgani(ations& Audit 'n )on*profit 'rgani(ations&
Assu.ption: Assu.ption:
Yes, $here Is A big -ifference Between Audit 'n #rofit 'rgani(ations Yes, $here Is A big -ifference Between Audit 'n #rofit 'rgani(ations
And Audit 'n )on*profit 'rgani(ations. And Audit 'n )on*profit 'rgani(ations.
Research 0"potheses: Research 0"potheses:
.* .* $here is a different between the mean of profit organi(ation and $here is a different between the mean of profit organi(ation and
nonprofit organi(ation. nonprofit organi(ation.
/* /* $here is a different between accounting for profit organi(ations and $here is a different between accounting for profit organi(ations and
nonprofit organi(ations. nonprofit organi(ations.
0* 0* $here is a difference between the accounting standards used in $here is a difference between the accounting standards used in
profit and nonprofit organi(ation. profit and nonprofit organi(ation.
1* 1* $here is no any difference between the audit standards used in $here is no any difference between the audit standards used in
profit and nonprofit organi(ation. profit and nonprofit organi(ation.
2* 2* $here is a difference between audit procedures used in audit on $here is a difference between audit procedures used in audit on
profit and nonprofit organi(ation. profit and nonprofit organi(ation.
3* 3* $here is a difference between documents used in the profit $here is a difference between documents used in the profit
organi(ation and nonprofit organi(ation. organi(ation and nonprofit organi(ation.
4* 4* $here is a different between financial statements for profit and $here is a different between financial statements for profit and
nonprofit organi(ations. nonprofit organi(ations.
5* 5* $here is a difference between the low used in profit organi(ations $here is a difference between the low used in profit organi(ations
and nonprofit organi(ations. and nonprofit organi(ations.
Research o&1ecti+es: Research o&1ecti+es:
.* .* -ifferentiate between the mean of profit organi(ation and nonprofit -ifferentiate between the mean of profit organi(ation and nonprofit
organi(ation. organi(ation.
/* /* -ifferentiate between accounting for profit organi(ations and -ifferentiate between accounting for profit organi(ations and
nonprofit organi(ations. nonprofit organi(ations.
!
0* 0* -ifferentiate the accounting standards used in profit and nonprofit -ifferentiate the accounting standards used in profit and nonprofit
organi(ation. organi(ation.
1* 1* -ifferentiate between the audit standards used in profit and -ifferentiate between the audit standards used in profit and
nonprofit organi(ation. nonprofit organi(ation.
2* 2* -ifferentiate between audit procedures used in audit on profit and -ifferentiate between audit procedures used in audit on profit and
nonprofit organi(ation. nonprofit organi(ation.
3* 3* documents used in the profit organi(ation and nonprofit documents used in the profit organi(ation and nonprofit
organi(ation. organi(ation.
4* 4* -ifferentiate between financial statements for profit and nonprofit -ifferentiate between financial statements for profit and nonprofit
organi(ations. organi(ations.
5* 5* -ifferentiate between the low used in profit organi(ations and -ifferentiate between the low used in profit organi(ations and
nonprofit organi(ations. nonprofit organi(ations.
The I.portance O% The Stud": The I.portance O% The Stud":
$his Study Shows Similarities and differences between audit on profit $his Study Shows Similarities and differences between audit on profit
organi(ations and non profit organi(ations which gives the answers to organi(ations and non profit organi(ations which gives the answers to
many 6uestions among people in general and especially among many 6uestions among people in general and especially among
accountants on the relationship between profit and non profit accountants on the relationship between profit and non profit
organi(ations, the etent of the differences between them, procedures organi(ations, the etent of the differences between them, procedures
used on accounting and audit and ending with financial statements. used on accounting and audit and ending with financial statements.
Research 2ethodoog": Research 2ethodoog":
.* Source of -ata "ollection7 .* Source of -ata "ollection7
8sing #rimary and Secondary Sources7 8sing #rimary and Secondary Sources7
#rimary7 Interviews with Auditors. #rimary7 Interviews with Auditors.
Secondary7 -ata "ollected +rom #revious studies. Secondary7 -ata "ollected +rom #revious studies.
/* %esearch Sample7 /* %esearch Sample7
+ive Audit 'ffices and .9 "ompanies including #rofit And nonprofit +ive Audit 'ffices and .9 "ompanies including #rofit And nonprofit
"ompanies. "ompanies.
$eter.inants O% Research: $eter.inants O% Research:
"ompanies and audit 'ffices among :a(a Strip Because 'f the Israeli "ompanies and audit 'ffices among :a(a Strip Because 'f the Israeli
restrictions. restrictions.
*
Chapter 2:
Research in Theor":
Audits are performed to ascertain the Audits are performed to ascertain the validity validity and and reliability reliability of of
information; also to provide an assessment of a system!s information; also to provide an assessment of a system!s internal control internal control. .
$he goal of an audit is to epress an opinion on the person < $he goal of an audit is to epress an opinion on the person <
organi(ation < system =etc.> in 6uestion, under evaluation based on work organi(ation < system =etc.> in 6uestion, under evaluation based on work
done on a test basis. done on a test basis.
-ue to practical constraints, an audit seeks to provide only reasonable -ue to practical constraints, an audit seeks to provide only reasonable
assurance that the statements are free from material error. ?ence, assurance that the statements are free from material error. ?ence,
statistical sampling is often adopted in audits. In the case of statistical sampling is often adopted in audits. In the case of financial financial
audits audits, a set of financial statements are said to be true and fair when they , a set of financial statements are said to be true and fair when they
are free of material misstatements * a concept influenced by both are free of material misstatements * a concept influenced by both
6uantitative 6uantitative =numerical> and =numerical> and 6ualitative 6ualitative factors. factors.
Auditing is a vital part of Auditing is a vital part of accounting accounting. $raditionally, audits were mainly . $raditionally, audits were mainly
associated with gaining information about financial systems and the associated with gaining information about financial systems and the
financial records of a company or a business. ?owever, recent auditing financial records of a company or a business. ?owever, recent auditing
has begun to include non*financial sub@ect areas, such as safety, security, has begun to include non*financial sub@ect areas, such as safety, security,
information systems performance, and environmental concerns. ,ith information systems performance, and environmental concerns. ,ith
nonprofit organi(ations and government agencies, there has been an nonprofit organi(ations and government agencies, there has been an
increasing need for increasing need for performance audits performance audits, eamining their success in , eamining their success in
satisfying mission ob@ectives. As a result, there are now audit satisfying mission ob@ectives. As a result, there are now audit
professionals who speciali(e in professionals who speciali(e in security audits security audits, , information systems information systems
audits audits, and , and environmental audits environmental audits. .
In In financial accounting financial accounting, an audit is an independent assessment of the , an audit is an independent assessment of the
fairness by which a company!s financial statements are presented by its fairness by which a company!s financial statements are presented by its
management. It is performed by competent, independent and ob@ective management. It is performed by competent, independent and ob@ective
person=s> known as auditors, who then issue an person=s> known as auditors, who then issue an auditor!s report auditor!s report based on based on
the results of the audit. the results of the audit.
In In cost accounting cost accounting, it is a process for verifying the cost of manufacturing , it is a process for verifying the cost of manufacturing
or producing of any article, on the basis of accounts measuring the use of or producing of any article, on the basis of accounts measuring the use of
material, labor or other items of cost. In simple words the term, cost material, labor or other items of cost. In simple words the term, cost
audit, means a systematic and accurate verification of the cost accounts audit, means a systematic and accurate verification of the cost accounts
and records, and checking for adherence to the cost accounting and records, and checking for adherence to the cost accounting
ob@ectives. According to the Institute of "ost and Management ob@ectives. According to the Institute of "ost and Management
Accountants of #akistan, a cost audit is &an eamination of cost Accountants of #akistan, a cost audit is &an eamination of cost
accounting records and verification of facts to ascertain that the cost of accounting records and verification of facts to ascertain that the cost of
the product has been arrived at, in accordance with principles of cost the product has been arrived at, in accordance with principles of cost
accounting.& accounting.&
An audit must adhere to generally accepted standards established by An audit must adhere to generally accepted standards established by
governing bodies. $hese standards assure third parties or eternal users governing bodies. $hese standards assure third parties or eternal users
that they can rely upon the auditor!s opinion on the fairness of financial that they can rely upon the auditor!s opinion on the fairness of financial
statements, or other sub@ects on which the auditor epresses an opinion. statements, or other sub@ects on which the auditor epresses an opinion.
-
$he -efinition for Auditing and Assurance Standard =AAS> . by I"AI * $he -efinition for Auditing and Assurance Standard =AAS> . by I"AI *
&Auditing is the independent eamination of financial information of any &Auditing is the independent eamination of financial information of any
entity, whether profit oriented or not, and irrespective of its si(e or legal entity, whether profit oriented or not, and irrespective of its si(e or legal
form, when such an eamination is conducted with a view to epressing form, when such an eamination is conducted with a view to epressing
an opinion thereon an opinion thereon
T"pes o% auditors T"pes o% auditors =./>
Auditors of financial statements can be classified into two categories7 Auditors of financial statements can be classified into two categories7
Aternal auditor Aternal auditor < < Statutory auditor Statutory auditor is an independent is an independent #ublic #ublic
accounting accounting firm engaged by the client sub@ect to the audit, to firm engaged by the client sub@ect to the audit, to
epress an opinion on whether the company!s epress an opinion on whether the company!s financial statements financial statements
are free of material misstatements, whether due to fraud or error. are free of material misstatements, whether due to fraud or error.
+or +or publicly*traded companies publicly*traded companies, eternal auditors may also be , eternal auditors may also be
re6uired to epress an opinion over the effectiveness of re6uired to epress an opinion over the effectiveness of internal internal
controls controls over over financial reporting financial reporting. Aternal auditors may also be . Aternal auditors may also be
engaged to perform other agreed*upon procedures, related or engaged to perform other agreed*upon procedures, related or
unrelated to financial statements. Most importantly, eternal unrelated to financial statements. Most importantly, eternal
auditors, though engaged and paid by the company being audited, auditors, though engaged and paid by the company being audited,
are regarded as are regarded as independent auditors independent auditors. .
$he most used eternal audit standards are the 8S $he most used eternal audit standards are the 8S :AAS :AAS of the of the
American Institute of "ertified #ublic Accountants American Institute of "ertified #ublic Accountants; and the ISA ; and the ISA
International Standards on Auditing International Standards on Auditing developed by the developed by the International International
Auditing and Assurance Standards Board Auditing and Assurance Standards Board of the of the International +ederation International +ederation
of Accountants of Accountants
Internal auditors Internal auditors are employed by the organi(ation they audit. $hey are employed by the organi(ation they audit. $hey
perform various audit procedures, primarily related to procedures perform various audit procedures, primarily related to procedures
over the effectiveness of the company!s internal controls over over the effectiveness of the company!s internal controls over
financial reporting. -ue to the re6uirement of financial reporting. -ue to the re6uirement of Section 191 Section 191 of the of the
Sarbanes 'ley Act Sarbanes 'ley Act of /99/ for management to also assess the of /99/ for management to also assess the
effectiveness of their internal controls over financial reporting =as effectiveness of their internal controls over financial reporting =as
also re6uired of the eternal auditor>, internal auditors are utili(ed also re6uired of the eternal auditor>, internal auditors are utili(ed
to make this assessment. $hough internal auditors are not to make this assessment. $hough internal auditors are not
considered independent of the company they perform audit considered independent of the company they perform audit
procedures for, internal auditors of publicly*traded companies are procedures for, internal auditors of publicly*traded companies are
re6uired to report directly to the re6uired to report directly to the board of directors board of directors, or a sub* , or a sub*
committee of the board of directors, and not to committee of the board of directors, and not to management management, so to , so to
reduce the risk that internal auditors will be pressured to produce reduce the risk that internal auditors will be pressured to produce
favorable assessments. favorable assessments.
$he most used Internal Audit standards are those of the $he most used Internal Audit standards are those of the Institute of Institute of
Internal Auditors Internal Auditors
"onsultant "onsultant auditors are eternal personnel contracted by the firm to auditors are eternal personnel contracted by the firm to
perform an audit following the firm!s perform an audit following the firm!s auditing standards auditing standards. $his . $his
differs from the eternal auditor, who follows their own auditing differs from the eternal auditor, who follows their own auditing
standards. $he level of independence is therefore somewhere standards. $he level of independence is therefore somewhere
)
between the internal auditor and the eternal auditor. $he between the internal auditor and the eternal auditor. $he
consultant auditor may work independently, or as part of the audit consultant auditor may work independently, or as part of the audit
team that includes internal auditors. "onsultant auditors are used team that includes internal auditors. "onsultant auditors are used
when the firm lacks sufficient epertise to audit certain areas, or when the firm lacks sufficient epertise to audit certain areas, or
simply for staff augmentation when staff are not available. simply for staff augmentation when staff are not available.
Audit 0istor" =./>
Agyptians recorded in history as first people who work and develop
accounting and auditing @ob, in which the public employees were keeping
books for controlling the revenues and epenses.
$he history record that both :reece and Agypt governments were using
accounting and auditing to ensure the truth of accounts.
$he auditor in :reece was review the entries recorded in books. $he
word &Auditing& derived from Batina word &Audire& that means
listening.
$hen in fifteenth century the double entry method discovered, that lead
the implementation of auditing more than easy and spread that lead to
develop auditing @ob.
As result for industry revluation and trading progress in Aurope to
establish huge pro@ects and reason which help to develop auditing @ob and
increase demand for auditing services, in which limited corporations
established.
Aconomic and industrial progress lead to establish limited corporations
that considered danger and important in the same time, it form important
rule in the economy, so many laws issued to organi(e it.
Spread between management and property increase the demand on
auditing services to protect owners behalf.
$he taation and financial polices were playing important rule in auditing
developing.
As shown before we note increase demand on auditing services, the
professional organi(ing movement discovered in 8C in .521 then in
"anada in .559 then +rance .55., then 8SA in .55/, :ermany .5D3,
Australia .D91, +inland .D...
$he increase of auditing services demand lead to establish associations to
organi(e.
$he @ob and protect members behalf in societies such as in 8SA and 8C
.* American Institute of "ertified #ublic Accountants =AI"#A> *8SA
/* "itified #ublic Accountants =A#AS> * 8SA
0* +inancial Accounting Standers Board =+ASB> * 8SA
1* Internal %evenue Services =I%S> E 8SA
2* $he Institute of "hartered Accountants =I"A> * 8C
3* $he Association at "ertified Accountants =A""A>*8C
#
I.portance o% Audit =./>
$here are many groups depend on Auditor report for make specific
decisions such as customers, management, banks and governmental
bodies.
A* Importance of Audit for "ustomer7
.*main source of information through audited financial statements.
/* Basic to get loans from banks.
0* Basic for additional investments.
1* Basic for prepare taation statements.
2* Basic to ensure of fairness of financial position.
B* Importance of Audit for management7
Management depend completely upon accounting data, in planning
and take suitable decisions, and evaluate it.
"* Importance of Audit for Banks7
Audited +inancial statement depend on Auditor report to analy(e
statements before provide loans, and depended as basic to
determine degree of risk.
-* Importance of Audit for governmental bodies7
Audited financial statements depended for planning leading and
controlling the economic entities to ensure of binding laws and
procedures
Auditing O&1ecti+es =./>
Auditing ob@ectives improved as result of many reasons in the last
period.
Bobas sentence & Auditor is watch*dog not a blood hoverd &
,e can determine Auditing 'b@ectives in two main groups
traditional and modern.
.*$raditional ob@ective7 classify into main and secondary
a* Main ob@ectives7
- ensure of truth of financial statements
- epress independent opinion
b* Secondary ob@ectives7
- discover fraud.
- used in planning and polices.
- ensure of fairly of financial statements.
- determine ta amounts.
- submit various reports.
/
/* Modern ob@ectives7
a*control the plan and follow*up it!s eecutes and the range of
goals achievement.
b* Asses activities results.
c* Achieve maimi(e range of efficiency and effective.
d*Achieve maimi(e range of comfortable for society.
3
Chapter !: $i%%erences &et'een pro%it and nonpro%it organi(ations:

2eans o% pro%it and nonpro%it organi(ation:
Pro%it organi(ation
'rgani(ations interact through various markets to achieve profit and to
maimi(e share holders wealth, profit organi(ation classified into three
categories!7
a* proprietorship 7 organi(ation owned by one person, he and @ust he
has the authority to make anything, the organi(ation end if he die.
b* Partnership 7 organi(ation owned by two or more persons this
organi(ation also provide goods and services to a chive profit.
c* Corporations 7 organi(ation owned by many persons accordance to
6uota of shares for each one, each one has responsibility to his
shares.
Nonpro%it organi(ation:
'rgani(ation does not have share holders it may have members, it may be
association. $he organi(ation may be controlled by it!s members who
elect board of directors or board of trustees, nonprofit organi(ation may
have delegate structure to allow for the representation of groups as
members.
$he main goal for nonprofit organi(ation is not a chive profit but to serve
the society.
La' &et'een pro%it and nonpro%it:
14Pro%it organi(ation:
Aach organi(ation need law to governed form all sides, profit
organi(ation governed by laws established by the country for eamples in
#alestine profit organi(ations governed by company law and investment
law and so on.
24 Nonpro%it organi(ations:
Most @urisdictions have laws governing the setting up, running, and
reporting re6uirements of these organi(ations, in many aspects they are
similar to business entities though there are often significant differences,
both profit and nonprofit must have board members, steering committee
members, or trustees who owe the organi(ation.
Aamples for laws on nonprofit on nonprofit organi(ation
=commonwealth laws, Auropean 8nion nonprofit laws>.
15
Financia state.ents: =.0>
A financial statement =or financial report> is a formal record of the
financial activities of a business, person, or other entity. although the
term financial statement is also used, particularly by accountants.
+or a business enterprise, all the relevant financial information, presented
in a structured manner and in a form easy to understand, are called the
financial statements. $hey typically include four basic financial
statements, accompanied by a management discussion and analysis7
Baance sheet: also referred to as statement of financial position or
condition, reports on a company!s assets, liabilities, and 'wnership
e6uity at a given point in time.
Inco.e state.ent: also referred to as #rofit and Boss statement =or a
&#FB&>, reports on a company!s income, epenses, and profits over a
period of time. #rofit F Boss account provide information on the
operation of the enterprise. $hese include sale and the various epenses
incurred during the processing state.
State.ent o% retained earnings : eplains the changes in a company!s
retained earnings over the reporting period.
State.ent o% cash %o's: reports on a company!s cash flow activities,
particularly its operating, investing and financing activities.
+or large corporations, these statements are often comple and may
include an etensive set of notes to the financial statements and
management discussion and analysis. $he notes typically describe each
item on the balance sheet, income statement and cash flow statement in
further detail. )otes to financial statements are considered an integral part
of the financial statements.
#urpose of financial statements by business entities
&$he ob@ective of financial statements is to provide information about the
financial position, performance and changes in financial position of an
enterprise that is useful to a wide range of users in making economic
decisions.& +inancial statements should be understandable, relevant,
reliable and comparable. %eported assets, liabilities, e6uity, income and
epenses are directly related to an organi(ation!s financial position.
+inancial statements are intended to be understandable by readers who
have &a reasonable knowledge of business and economic activities and
accounting and who are willing to study the information
diligently.& +inancial statements may be used by users for different
purposes7
'wners and managers re6uire financial statements to make important
business decisions that affect its continued operations. +inancial
analysis is then performed on these statements to provide management
11
with a more detailed understanding of the figures. $hese statements are
also used as part of management!s annual report to the stockholders.
Amployees also need these reports in making collective
bargaining agreements ="BA> with the management, in the case of labor
unions or for individuals in discussing their compensation, promotion and
rankings.
#rospective investors make use of financial statements to assess the
viability of investing in a business. +inancial analyses are often used by
investors and are prepared by professionals =financial analysts>, thus
providing them with the basis for making investment decisions.
+inancial institutions =banks and other lending companies> use them to
decide whether to grant a company with fresh working capital or etend
debt securities =such as a long*term bank loan or debentures> to finance
epansion and other significant ependitures.
:overnment entities =ta authorities> need financial statements to
ascertain the propriety and accuracy of taes and other duties declared
and paid by a company.
Gendors who etend credit to a business re6uire financial statements to
assess the creditworthiness of the business.
Media and the general public are also interested in financial statements
for a variety of reasons.
Financia state.ents o% non4pro%it organi(ations:
$he financial statements of non*profit organi(ations that publish financial
statements, such as charitable organi(ations and large voluntary
associations, tend to be simpler than those of for*profit corporations.
'ften they consist of @ust a balance sheet and a &statement of activities&
=listing income and epenses> similar to the &#rofit and Boss statement&
of a for*profit. "haritable organi(ations in the 8nited States are re6uired
to show their income and net assets =e6uity> in three categories7
8nrestricted =available for general use>, $emporarily %estricted =to be
released after the donor!s time or purpose restrictions have been met>, and
#ermanently %estricted =to be held perpetually, e.g., in an Andowment>.
Interna S"ste.:
14 Pro%it organi(ation
$he board of director in the profit organi(ation is part of share holders to
manage the organi(ation and to hire general manager and his
management the main goal is to maimi(e wealth, they supported by their
capital.
12
+rom the chart we show that the management and it!s department
=financial, marketing, production and so on> seeking @ust to get profit and
to maimi(e wealth of share holders
Nonpro%it Organi(ation:
In nonprofit organi(ation the board of director don!t seek to get profit but
to search and get donations from donors to service society from may
sides such as =economic, medical, educational and so on>.

Board o%
$irector
6enera
2anager
E.po"ees
A%%airs
Production
2anage.ent
2ar7eting
2anage.ent
Financia
2anage.ent
Board o%
$irector
Ser+ices
2anage.ent
Financia
2anage.ent
1!
In which the services management service society and provide helps to
society and financial management many financial Affairs of the
organi(ation =donations, ependitures and so on>
$ocu.ents used in the pro%it organi(ation and nonpro%it
organi(ation8
Pro%it Organi(ations:
$he #rofit 'rgani(ations organi(e their documents depending on their
needs to make work easier and more clear than any time else.
Based on the type of profit organi(ations the documents issued, and the
following table shows the differences between the profit organi(ations
documents7
Industrial $rade Service
%evenues Sale invoice Sale invoice Service invoice
#urchases #urchase invoice #urchase invoice Hust epense invoice
'rder , Bids I 'rder I etc
Nonpro%it Organi(ations:
Because nonprofit organi(ations in not for profit that mean it did not sell
goods or make a service to have money , it!s goal is social to help citi(ens
and society to develop more and more, So it use another type of
documents which is Money vouchers. Money vouchers depend on cash
basis that the time we pay we take a receipt voucher and the time we take
money we give receipt voucher.
Accounting Standards Bet'een pro%it organi(ations and non4
pro%it organi(ations:
Because of the development of the businesses around the world and
ending in the multinational companies, the world needed to have an
international accounting standards to make it easy to account to every
company in this world.
International accounting standards putted before about .4 years but the
board of international accounting standards established in /99. in
Bondon and its members are .1 around the world, the international
accounting standards edited by need and it developed to be suitable for
the new pro@ects around the world.
)ow we have 1. international accounting standards, it edited in /9.9 to
be easier to deal with the international trade.
$he international accounting standards contain and arrange every stage
and type of accounting.
$he International accounting standards contain the standards to deal with
the profit and nonprofit organi(ations and there are different type of
1*
standards used in this organi(ations some of it is the same and the other is
differ, for an eample the profit organi(ations use accrual basis or
modified accrual basis as suitable for the king of business but in the
nonprofit organi(ations have to use cash basis because of the nature of
this organi(ations.

Audit standards used in pro%it and nonpro%it organi(ation8
$here Is )o -ifferences Between Audit Standards 8sed In #rofit And $here Is )o -ifferences Between Audit Standards 8sed In #rofit And
)on #rofit 'rgani(ations Because All of it depend on the auditor )on #rofit 'rgani(ations Because All of it depend on the auditor
personality. And here is $he :enerally Accepted Audit Standards7 personality. And here is $he :enerally Accepted Audit Standards7
6enera Standards 6enera Standards
.. .. $he auditor must have ade6uate technical training and proficiency $he auditor must have ade6uate technical training and proficiency
to perform the audit. to perform the audit.
/. /. $he auditor must maintain independence in mental attitude in all $he auditor must maintain independence in mental attitude in all
matters related to the audit. matters related to the audit.
0. 0. $he auditor must use due professional care during the performance $he auditor must use due professional care during the performance
of the audit and the preparation of the report. of the audit and the preparation of the report.
Standards o% Fied 9or7 Standards o% Fied 9or7
.. .. $he auditor must ade6uately plan the work and must properly $he auditor must ade6uately plan the work and must properly
supervise any assistants. supervise any assistants.
/. /. $he auditor must obtain a sufficient understanding of the entity and $he auditor must obtain a sufficient understanding of the entity and
its environment, including its internal control, to assess the risk of its environment, including its internal control, to assess the risk of
material misstatement of the financial statements whether due to material misstatement of the financial statements whether due to
error or fraud, and to design the nature, timing, and etent of error or fraud, and to design the nature, timing, and etent of
further audit procedures. further audit procedures.
0. 0. $he auditor must obtain sufficient appropriate audit evidence by $he auditor must obtain sufficient appropriate audit evidence by
performing audit procedures to afford a reasonable basis for an performing audit procedures to afford a reasonable basis for an
opinion regarding the financial statements under audit. opinion regarding the financial statements under audit.
Standards o% Reporting Standards o% Reporting
.. .. $he auditor must state in the auditor!s report whether the financial $he auditor must state in the auditor!s report whether the financial
statements are presented in accordance with generally accepted statements are presented in accordance with generally accepted
accounting principles. accounting principles.
/. /. $he auditor must identify in the auditor!s report those $he auditor must identify in the auditor!s report those
circumstances in which such principles have not been consistently circumstances in which such principles have not been consistently
observed in the current period in relation to the preceding period. observed in the current period in relation to the preceding period.
0. 0. ,hen the auditor determines that informative disclosures are not ,hen the auditor determines that informative disclosures are not
reasonably ade6uate, the auditor must so state in the auditor!s reasonably ade6uate, the auditor must so state in the auditor!s
report. report.
1. 1. $he auditor must either epress an opinion regarding the financial $he auditor must either epress an opinion regarding the financial
statements, taken as a whole, or state that an opinion cannot be statements, taken as a whole, or state that an opinion cannot be
epressed, in the auditor!s report. ,hen the auditor cannot epress epressed, in the auditor!s report. ,hen the auditor cannot epress
an overall opinion, the auditor should state the reasons therefore in an overall opinion, the auditor should state the reasons therefore in
1-
the auditor!s report. In all cases where an auditor!s name is the auditor!s report. In all cases where an auditor!s name is
associated with financial statements, the auditor should clearly associated with financial statements, the auditor should clearly
indicate the character of the auditor!s work, if any, and the degree indicate the character of the auditor!s work, if any, and the degree
of responsibility the auditor is taking, in the auditor!s report. of responsibility the auditor is taking, in the auditor!s report.
Audit procedures used in audit on pro%it and nonpro%it
organi(ation8
Audit procedures are summari(ed as follows with -ifferentiate
between profit organi(ation procedures and nonprofit organi(ation
procedures in every step.
.. 8nderstand the nature of the client in terms of legal entity and the
type of activity and its organi(ational structure and accounting
systems and in the light of this information to the auditor to accept
the task of checking the operation or to apologi(e for that.
The Objective of The Profit Organizations Is To make profit but in
the nonprofit it's goal is to achieve social and economic
development.
The Accounting Sstem differ because of the nature of the accounts
used.
/. 8nderstand the components of internal control systems available to
the client and include understanding environment systems of
internal control mechanism =accounting systems used>, and
procedures for internal control systems and know how to put into
practice and through which therefore determines the etent to
which customer accounts to sift through it If it turns out his
indivisibility of the audit by the withdrawal from the task.
!ver Tpe of Organization have its internal control "hich can be
suitable for the uses of ever tpe.
0. Avaluate the degree of risk in the systems of internal control, if it
was agreed that the degree of risk is high in that reveal internal
control systems automatically material things which showed what
they are not in the closing statements are risks checking high or
when the degree of risk in auditing low must understand the control
systems and identify things strengthen the conviction that the
auditor because the degree of risk is substandard.
The #egree of risk "ill not be differing b comparing profit and The #egree of risk "ill not be differing b comparing profit and
nonprofit organization$ it can be differ b the nature of nonprofit organization$ it can be differ b the nature of
organization projects and organization members. organization projects and organization members.
1. Ampirical Audit7
1)
Auditors uses its assessment of internal control systems and his
degree of risk of audit in determining the nature of the audit, the
timing of audit work and the time re6uired for the audit and the
si(e of the sample.
In This Stage of Audit Procedures There IS %o An #ifferent &an In This Stage of Audit Procedures There IS %o An #ifferent &an
'e (appen bet"een Profit and %on)Profit Organization be 'e (appen bet"een Profit and %on)Profit Organization because cause
This Stage #epend On The auditor size of the "ork not on the kind This Stage #epend On The auditor size of the "ork not on the kind
of it. of it.
2. Avaluate the results of the audit
after the auditor finish his work he will assess the results of the
work and decide if he can base of his work result to give an
opinion on the financial statement of the organi(ation. .
In This Stage *e can sa that the nature of the profit organizations In This Stage *e can sa that the nature of the profit organizations
"ill be harder to understand and check. "ill be harder to understand and check.
3. Auditor!s %eport7
$he Bast Stage and procedure in the audit procedures is the auditor
report which in the auditor give his opinion about the fairness of the
financial statements of the organi(ation.
The #ifference in this stage bet"een profit and nonprofit
organizations is the financial statements itself+ the financial
statements of the profit organizations are, 'alance sheet+ Profit And
loss+ Trade+ &ash -lo"...!tc.+ but these financial statements are not
the same in nonprofit organization+ profit organization financial
statements are, Statement Of Activit and Special Purpose Statement.
1#
Chapter *: Chapter *:
Pre+ious Studies , Inter+ie's 'ith the Auditors:4 Pre+ious Studies , Inter+ie's 'ith the Auditors:4
$his "hapter includes the previous studies and interviews with the $his "hapter includes the previous studies and interviews with the
sample of auditors and their accepting or refusing the assumptions of the sample of auditors and their accepting or refusing the assumptions of the
research. research.
Pre+ious Stidies: Pre+ious Stidies:
.* .* Statements on Auditing Standards by Mole +oryal7 Statements on Auditing Standards by Mole +oryal7
Statements on Auditing Standards =SASs> are issued by the Auditing Statements on Auditing Standards =SASs> are issued by the Auditing
Standards Board =ASB>, the senior technical body of the AI"#A Standards Board =ASB>, the senior technical body of the AI"#A
designated to issue pronouncements on auditing matters applicable to the designated to issue pronouncements on auditing matters applicable to the
preparation and issuance of audit reports for nonissuers. %ules /9. and preparation and issuance of audit reports for nonissuers. %ules /9. and
/9/ of the /9/ of the AI"#A "ode of #rofessional "onduct AI"#A "ode of #rofessional "onduct re6uire an AI"#A re6uire an AI"#A
member who performs an audit of a nonissuer to comply with standards member who performs an audit of a nonissuer to comply with standards
promulgated by the ASB. $he auditor should have sufficient knowledge promulgated by the ASB. $he auditor should have sufficient knowledge
of the SASs to identify those that are applicable to his or her audit and of the SASs to identify those that are applicable to his or her audit and
should be prepared to @ustify departures from the SASs. should be prepared to @ustify departures from the SASs.
Auditing Interpretations of SASs are interpretive publications pursuant to Auditing Interpretations of SASs are interpretive publications pursuant to
A8 section .29 A8 section .29. Interpretive publications are recommendations on the . Interpretive publications are recommendations on the
application of SASs in specific circumstances, including engagements for application of SASs in specific circumstances, including engagements for
entities in speciali(ed industries. Interpretive publications are issued entities in speciali(ed industries. Interpretive publications are issued
under the authority of the ASB. $he auditor should identify interpretive under the authority of the ASB. $he auditor should identify interpretive
publications applicable to his or her audit. If the auditor does not apply publications applicable to his or her audit. If the auditor does not apply
the auditing guidance included in an applicable interpretive publication, the auditing guidance included in an applicable interpretive publication,
the auditor should be prepared to eplain how he or she complied with the auditor should be prepared to eplain how he or she complied with
the SAS provisions addressed by such auditing guidance. the SAS provisions addressed by such auditing guidance.
/*
Auditors Apand Attack on +raud by Margaret H. $anney, "#A, is Auditors Apand Attack on +raud by Margaret H. $anney, "#A, is
a Shareholder with Alpern %osenthal. She can be reached at a Shareholder with Alpern %osenthal. She can be reached at
mtanneyJalpern.com
. .
)umerous stories of financial statement fraud and alleged misconduct )umerous stories of financial statement fraud and alleged misconduct
have been covered in the media in the recent past including ,orld"om, have been covered in the media in the recent past including ,orld"om,
Kero, Anron, Adelphia and $yco, to name a few. $o implement Kero, Anron, Adelphia and $yco, to name a few. $o implement
accounting reform and corporate accountability, the "ongress passed and accounting reform and corporate accountability, the "ongress passed and
the #resident signed the Sarbanes*'ley Act of /99/. ,hile the Act the #resident signed the Sarbanes*'ley Act of /99/. ,hile the Act
applies to public companies, closely*held businesses and not*for*profit applies to public companies, closely*held businesses and not*for*profit
organi(ations have also been affected by the recent frauds. organi(ations have also been affected by the recent frauds.
At about the same time as the Sarbanes*'ley Act was passed, the At about the same time as the Sarbanes*'ley Act was passed, the
American Institute of "ertified #ublic Accountants =AI"#A> issued a American Institute of "ertified #ublic Accountants =AI"#A> issued a
statement entitled "onsideration of +raud in a +inancial Statement Audit statement entitled "onsideration of +raud in a +inancial Statement Audit
=Statement on Auditing Standards )o. DD, SAS DD>. $he new set of rules =Statement on Auditing Standards )o. DD, SAS DD>. $he new set of rules
is @ust one component of the AI"#ALs ongoing, comprehensive antifraud is @ust one component of the AI"#ALs ongoing, comprehensive antifraud
1/
and corporate responsibility program. SAS DD applies to all financial and corporate responsibility program. SAS DD applies to all financial
statement audits, regardless of the type of entity =public company, statement audits, regardless of the type of entity =public company,
closely*held company, not*for*profit, etc.> being audited. closely*held company, not*for*profit, etc.> being audited.
,hile the new standard does not change the auditorLs responsibility for ,hile the new standard does not change the auditorLs responsibility for
fraud detection, it does re6uire the auditor to take etra steps to uncover fraud detection, it does re6uire the auditor to take etra steps to uncover
it. SAS DD will result in a substantial change in audit practice and more it. SAS DD will result in a substantial change in audit practice and more
effective audits as it re6uires the independent auditor to obtain a more in* effective audits as it re6uires the independent auditor to obtain a more in*
depth understanding of their clients, including its internal controls, to depth understanding of their clients, including its internal controls, to
identify the risks of material misstatements in the financial statements identify the risks of material misstatements in the financial statements
and determine what the clients are doing to mitigate those risks. and determine what the clients are doing to mitigate those risks.
Accounting firm clients, bankers, users of audited financial statements as Accounting firm clients, bankers, users of audited financial statements as
well as the general public have increasing epectations on the ability of well as the general public have increasing epectations on the ability of
the eternal auditor to detect fraud. the eternal auditor to detect fraud.
,hether you are a private business owner, a controller or a board ,hether you are a private business owner, a controller or a board
member of a not*for*profit organi(ation, this new audit standard will member of a not*for*profit organi(ation, this new audit standard will
affect your organi(ationLs interaction with the audit team. affect your organi(ationLs interaction with the audit team.
Benefits of the new standard Benefits of the new standard
Implementing new audit procedures can be challenging and Implementing new audit procedures can be challenging and
uncomfortable at times. ?owever, the new standard has some significant uncomfortable at times. ?owever, the new standard has some significant
benefits for organi(ations. Aamples include7 benefits for organi(ations. Aamples include7
Your auditors will discuss with management, owners and boards Your auditors will discuss with management, owners and boards
fraud risk factors, both those related to fraudulent financial reporting =i.e., fraud risk factors, both those related to fraudulent financial reporting =i.e.,
cooking the books> and misappropriation of assets =i.e., stealing> cooking the books> and misappropriation of assets =i.e., stealing>
Based upon the information your auditors gather as a result of the Based upon the information your auditors gather as a result of the
epanded procedures called for in SAS DD, your auditors may7 evaluate epanded procedures called for in SAS DD, your auditors may7 evaluate
whether the programs and controls your organi(ation currently has in whether the programs and controls your organi(ation currently has in
place address fraud risks factors identified and make recommendations to place address fraud risks factors identified and make recommendations to
help your organi(ation deter and detect fraud in order to prevent financial help your organi(ation deter and detect fraud in order to prevent financial
losses from misappropriation of assets losses from misappropriation of assets
?ow the new standard affects the audit procedures ?ow the new standard affects the audit procedures
$he following are some of the effects an organi(ation may notice during $he following are some of the effects an organi(ation may notice during
the audit as the audit team applies the re6uirements of the new standard7 the audit as the audit team applies the re6uirements of the new standard7
Additional in6uiries and communications by the audit team Additional in6uiries and communications by the audit team
Additional emphasis on controls to prevent stealing, including Additional emphasis on controls to prevent stealing, including
controls over cash disbursements controls over cash disbursements
Aamination of @ournal entries and other ad@ustments Aamination of @ournal entries and other ad@ustments
#erformance of a Mretrospective reviewN of prior accounting #erformance of a Mretrospective reviewN of prior accounting
estimates made by management for biases estimates made by management for biases
8se of electronic testing approaches utili(ing computer*assisted 8se of electronic testing approaches utili(ing computer*assisted
audit techni6ues designed to MmineN the source data for unusual audit techni6ues designed to MmineN the source data for unusual
relationships and trends relationships and trends
13
-eveloping an understanding of the business rationale for -eveloping an understanding of the business rationale for
significant, unusual transactions including related party significant, unusual transactions including related party
transactions and ma@or property sales and echanges transactions and ma@or property sales and echanges
Introduction of an element of MsurpriseN in the scope, timing and Introduction of an element of MsurpriseN in the scope, timing and
etent of procedures performed etent of procedures performed
In conclusion, SAS DD will have an impact on the way audits are done for In conclusion, SAS DD will have an impact on the way audits are done for
private companies and non*profit organi(ations. ?owever, "#As are well private companies and non*profit organi(ations. ?owever, "#As are well
6ualified and trained to dig through financial records and ferret out the 6ualified and trained to dig through financial records and ferret out the
type of information needed to draw conclusions about the eistence of type of information needed to draw conclusions about the eistence of
fraud O a valuable asset to any organi(ation. fraud O a valuable asset to any organi(ation.
Inter+ie's 'ith auditors: Inter+ie's 'ith auditors:
Ne:t Ne:t are seven 6uestions asked to the auditors including a 6uestion for are seven 6uestions asked to the auditors including a 6uestion for
every assumption and then the answers for every 6uestion by the auditors. every assumption and then the answers for every 6uestion by the auditors.
$he Puestions7 $he Puestions7
.* .* Is there any different between the mean of profit organi(ation and Is there any different between the mean of profit organi(ation and
nonprofit organi(ation. nonprofit organi(ation.
/* /* Is there any different between accounting and accounting standards Is there any different between accounting and accounting standards
for profit organi(ations and nonprofit organi(ations. for profit organi(ations and nonprofit organi(ations.
0* 0* Is there any different between the audit standards used in profit and Is there any different between the audit standards used in profit and
nonprofit organi(ation. nonprofit organi(ation.
1* 1* Is there any different between audit procedures used in audit on Is there any different between audit procedures used in audit on
profit and nonprofit organi(ation. profit and nonprofit organi(ation.
2* 2* Is there any different between documents used in the profit Is there any different between documents used in the profit
organi(ation and nonprofit organi(ation. organi(ation and nonprofit organi(ation.
3* 3* Is there any different between financial statements for profit and Is there any different between financial statements for profit and
nonprofit organi(ations. nonprofit organi(ations.
4* 4* Is there any different between the low used in profit organi(ations Is there any different between the low used in profit organi(ations
and nonprofit organi(ations. and nonprofit organi(ations.
Answers by the sample of auditors7 Answers by the sample of auditors7
#?- Iskander )ashwan , $he chief of the board of director for #?- Iskander )ashwan , $he chief of the board of director for
the #alestinian society of certified public accountants. the #alestinian society of certified public accountants.
18 I think that the different can be in the goal of them, profit
organi(ation goal is to make profit and benefits but non*profit
organi(ation goal is to help people.
28 Yes the different in accounts uses, eample7 revenues in the profit
happen by selling goods or services, but in nonprofit revenues can
be donations. In accounting standards the difference can be in the
cash base.
!8 )o there is no difference in audit standards.
25
*8 Yes, audit procedures differ between the profit organi(ations and
nonprofit organi(ation and I can say It differ between all the
organi(ations which make and which don!t make profit.
-8 -ocuments used in every organi(ation has to be different because
of the nature of everyone.
)8 +inancial statements for profit is the income and balance sheet and
sometimes cash flows but in nonprofit is profit and loss account
and the change in the net assets and liabilities.
#8 ,e have different lows for every organi(ation in the country not
@ust for profit and nonprofit organi(ations.
::::::
18 'f course there is a big difference between them, every kind
of business has a difference with others and when we talk
about difference between profit and nonprofit organi(ations
we have to take in consideration the goal and the
components of these organi(ations, profit organi(ations has
its goal in making profit but nonprofit has its goal to be
helpful for the society.
28 $he difference can be mainly in the inventory, no inventory
in the nonprofit organi(ation and the international standards
talk about inventory which has no relation with nonprofit
organi(ation.
!8 Because the audit standards that depend on the auditor I
think there is no difference.
*8 $he audit procedures differ in the three stages planning,
implementation and in the resulting.
-8 #rofit organi(ation can be trade, industrial, row materiality
and service and it depend on the accrual basis but in the
nonprofit organi(ation id depend on cash basis which make
the documents differ.
)8 Avery organi(ation has its financial statements.
#8 $he profit organi(ations depending on the organi(ations low
which established in .D09 and itLs work until now, but there
is a new low for the nonprofit organi(ations which
established in /99D.
::::::
21
18 #rofit organi(ation is an organi(ation that going to make profit and
to decline unemployment but nonprofit organi(ation can!t be profit
organi(ations.
28 ,hen we talk about organi(ations we have to take in our
consideration that every kind of businesses have a different with
other organi(ations not @ust profit organi(ations and nonprofit
organi(ations. $he profit and nonprofit organi(ation depending on
many same international standards for accounting and differ in
some.
!8 I don!t think that there is any relation make different between audit
standards in the profit and nonprofit organi(ations.
*8 $he audit procedures different between all kinds of companies
which is profit so it will be different with the nonprofit
organi(ation.
-8 -ocuments differ specially in nonprofit organi(ations because itLs
documents depend on the low in the country it has its activities in
so the documents differ.
)8 $he name of financial statements maybe the same but what it
contain is the difference.
#8 Avery organi(ation has its #alestinian low and the same thing is for
profit and nonprofit organi(ations.
:::::
18 Avery kind of these organi(ations has its definition, profit
organi(ation is organi(ation that has its work maybe industrial ,
service or trade and nonprofit organi(ation work in help boor
people, making pro@ects to decline unemployment and so on.
28 Yes in profit organi(ation there is trade or service to make profit
but in the nonprofit the service is not to make profit so the
accounting will be different. International accounting standards
contain the standards used to account for profit and nonprofit and
maybe the difference can @ust be in the cash base use to account for
them.
!8 $he audit standards don!t make any difference in these two types of
organi(ations.
*8 $he three stages of audit procedures can be different because
planning in profit organi(ations is to make profit and in nonprofit is
to help society, so the supplier will different so the procedure on
audit on it will differ.
-8 $he main different can be in the nature of every organi(ation,
profit make profit so there is sales invoices and service invoices but
nonprofit itLs name is no profit so it @ust make epenses which in
the money voucher.
22
)8 In profit organi(ation there are many statements like profit loss,
balance sheet and cash flow. )onprofit organi(ation has profit and
loss and has change in net assets.
#8 'f course the different lows for profit organi(ations and nonprofit
organi(ations.
::::::
18 Yes there is a difference and it!s a big difference so clear and so
easy to tell about.
28 Yes, and an eample is when you talk about capital we can!t make
an entry which contain capital because there is no capital.
International accounting standards clear the difference in
accounting for every type of organi(ations.
!8 I think that there is no difference.
*8 $he procedures differ in all its aspects.
-8 'f course the documents different.
)8 +inancial statements used in profit and nonprofit organi(ations
differ because of the nature of this organi(ations, profit
organi(ations contain capital but there is no capital in nonprofit
organi(ations there is surplus or deficit on net assets and liabilities.
#8 Yes, every organi(ation has its low.
::::::
18 'h, yeah the difference can be mainly in the goal of every type of
these organi(ations.
28 +or most people the accounting for profit and nonprofit
organi(ation is the same but it isn!t, revenues in profit organi(ation
made by sell but in nonprofit made by receiving donations and for
another eample accounting for debtors and creditors, there are big
different between the debtors and creditors for such profit and
nonprofit organi(ations.
!8 $he difference can be in accounting standards but in audit
standards there is no difference.
*8 I $hink $he Stages In every #rocedure which differ but $he mail
procedures didnLt differ.
-8 #rofit organi(ation use purchases, orders and sales invoices but
nonprofit organi(ation use money vouchers for purchase payment
voucher and for receipt use receipt voucher.
)8 $he financial statements for profit organi(ations are income
statement, trade, balance sheet and cash flow. But in nonprofit
organi(ations there are profit and loss account and change in net
assets and liabilities.
2!
#8 #rofit organi(ations has a low work with in :a(a applied in .D09
and it work until now, and nonprofit organi(ations has a low
applied in /99D.
:::::
18 Maybe the different is in the ob@ective of every organi(ation, profit
organi(ation ob@ective is to make the profit, the money, but
nonprofit ob@ective is to help people by many ways.
28 'n the one hand, accounting for these organi(ations differ because
of the difference of the mean, the goal and the pro@ects of every
organi(ation. And on the other hand there are some international
accounting standards are the same in these organi(ations and there
are some are not the same.
!8 $he standards of audit talk about the general rules to audit and
these rules can!t be differing between all kinds of organi(ation.
*8 $he audit procedures differ between accounting on profit and on
nonprofit organi(ations.
-8 $he nature of every organi(ation make the documents differ.
)8 I think there is big different in statements used for profit and
nonprofit organi(ations, profit organi(ation search for profit and
the statements used eplain its profit like income statement and
also it eplain the shape of his position if he has liabilities or how
much is his capital as in balance sheet. But the financial statements
for nonprofit eplain the revenues and where is it gone like in the
profit and loss account, so it differ.
#8 Yes there is low for profit organi(ations and low for nonprofit
organi(ation.
::::::
18 #rofit organi(ations are a business which it!s @ob to create money
and nonprofit is an organi(ation that make pro@ects to develop the
country.
28 Accounting for profit organi(ation depending on the modified
accrual base but accounting for nonprofit organi(ation depending
on the cash base, so accounting for profit organi(ation differ with
accounting for nonprofit organi(ation and by the same thing there
are some of the international accounting standards with is the same
and others differ.
!8 )o there is no difference; you know the audit standards depend on
the auditor himself and on the work field.
*8 Avery procedure in audit procedures has its nature which differ
between profit and nonprofit.
2*
-8 #rofit organi(ation use accrual basis and nonprofit use cash basis
and every base has its documents.
)8 Many people think that the financial statements for the nonprofit
account stopped on the profit and loss account or on the change in
net assets and liabilities , but thatLs wrong because now we have
special purpose statements for activities and pro@ects like activity
statement. But from many years the is no mainly change in the
financial statements for the profit organi(ations which are Income
statement, balance sheet and cash flow.
#8 $he main effective difference which make the low differ is the base
that every organi(ation depend on.
::::::
18 Many differences, first different is in the internal system, second in
the goal, third in the documents used, forth is in the nature of the
work.
28 Yes accounting is different for the organi(ations, differ because
they differ in mean, documents, statements, ob@ectives , differ in
everything so of course the accounting will differ and of course it
will differ in the international accounting standards because the
accounting itself differ.
!8 I don!t see any different between these standards among these
organi(ations.
*8 Because the first audit procedure is planning and its differ between
profit and nonprofit so the net procedures has to be differ because
its depending on the planning which is implementation and
resulting.
-8 $he low use in the country for every organi(ation element the
documents to use specially in the nonprofit organi(ation.
)8 #rofit organi(ations have its financial statements and the nonprofit
organi(ations have its financial statements.
#8 Yes there is a different lows.
:::::: ::::::
18 )onprofit organi(ation established by persons who want to
improve the society by many pro@ects such as food baskets, support
boor families, help studentsI etc., but profit organi(ation has
many kinds such as industrial, trade, service and all these profit
organi(ations has the goal to make profit.
28 $he difference mainly is in the cash base maybe, and so on in the
international accounting standards but international accounting
standards some of it are the same like echange foreign currency.
2-
!8 $here is no difference because audit standards can be as a general
rules to audit and not a specific rule.
*8 $he audit procedures differ In all Its aspects.
-8 Yes it differ between these different kinds of organi(ation.
)8 I think that the financial statements for profit organi(ations are
income statement and balance sheet, but for nonprofit
organi(ations there are profit and loss statement and change in net
assets and liabilities statement.
#8 $he low for profit organi(ation is the corporations but for nonprofit
is the low for social associations.
2)
Chapter -: Chapter -:
Resuts And Reco..endations Resuts And Reco..endations
$hrough our Interviews with the auditors, illustrated that our assumptions $hrough our Interviews with the auditors, illustrated that our assumptions
improved as shown follows7 improved as shown follows7
.* .* $here is a different between the mean of profit organi(ation and $here is a different between the mean of profit organi(ation and
nonprofit organi(ation. nonprofit organi(ation.
All the sample agreed that there is a difference between the mean All the sample agreed that there is a difference between the mean
of profit organi(ation and nonprofit organi(ation. of profit organi(ation and nonprofit organi(ation.
/* /* $here is a different between accounting for profit organi(ations and $here is a different between accounting for profit organi(ations and
nonprofit organi(ations. nonprofit organi(ations.
$hrough the standards used and the procedures of book keeping $hrough the standards used and the procedures of book keeping
for each organi(ation. for each organi(ation.
0* 0* $here is a difference between the accounting standards used in $here is a difference between the accounting standards used in
profit and nonprofit organi(ation. profit and nonprofit organi(ation.
All the sample agreed that there is a difference between All the sample agreed that there is a difference between
accounting standards for profit and nonprofit organi(ation. accounting standards for profit and nonprofit organi(ation.
1* 1* $here is no any difference between the audit standards used in $here is no any difference between the audit standards used in
profit and nonprofit organi(ation. profit and nonprofit organi(ation.
All $he Sample agreed that there is no difference between the All $he Sample agreed that there is no difference between the
auditing standards used in profit and nonprofit organi(ation auditing standards used in profit and nonprofit organi(ation
because the auditing standards depend on the auditor his self. because the auditing standards depend on the auditor his self.
2* 2* $here is a difference between audit procedures used in audit on $here is a difference between audit procedures used in audit on
profit and nonprofit organi(ation. profit and nonprofit organi(ation.
All the sample agreed that there is a difference between all All the sample agreed that there is a difference between all
stages in the audit procedures. stages in the audit procedures.
3* 3* $here is a difference between documents used in the profit $here is a difference between documents used in the profit
organi(ation and nonprofit organi(ation. organi(ation and nonprofit organi(ation.
All $he Auditors in the sample agreed that there is a difference All $he Auditors in the sample agreed that there is a difference
between documents used in the profit and nonprofit between documents used in the profit and nonprofit
organi(ation. organi(ation.
4* 4* $here is a different between financial statements for profit and $here is a different between financial statements for profit and
nonprofit organi(ations. nonprofit organi(ations.
All the sample agreed with the differences In the financial All the sample agreed with the differences In the financial
statements used in the two types of organi(ations. statements used in the two types of organi(ations.
5* 5* $here is a difference between the low used in profit organi(ations $here is a difference between the low used in profit organi(ations
and nonprofit organi(ations. and nonprofit organi(ations.
All the sample agreed that every organi(ation has its low. All the sample agreed that every organi(ation has its low.

2#
Reco..endations: Reco..endations:
18 18 ,e recommend the creation of a #alestinian law for profit ,e recommend the creation of a #alestinian law for profit
corporations and applied to suit the needs of the #alestinian corporations and applied to suit the needs of the #alestinian
companies especially in this volatile economy. companies especially in this volatile economy.
28 28 ,e recommend the creation of periodical conference for ,e recommend the creation of periodical conference for
auditors to discuss the latest developments in the auditing auditors to discuss the latest developments in the auditing
field. field.
!8 !8 ,e recommend the epanding the scope of the #alestinian ,e recommend the epanding the scope of the #alestinian
auditing standards to include more and more the non*profit auditing standards to include more and more the non*profit
companies. companies.
*8 %e*assess the ability of the auditor in the :a(a Strip on the %e*assess the ability of the auditor in the :a(a Strip on the
work of the auditing profession work of the auditing profession.
2/
Re%erences: Re%erences:
.. .. www.Acc1arab.com www.Acc1arab.com QRSTU VWXYZ[\TU ]^W_ QRSTU VWXYZ[\TU ]^W_
/. /. www.auditnet.org www.auditnet.org
0. 0. ,ikipedia $he +ree encyclopedia ,ikipedia $he +ree encyclopedia
1. 1. www.pacpa.ps www.pacpa.ps
2. 2. http7<<www.met.gov.ps<-esktop-efault.asp`lnga/ http7<<www.met.gov.ps<-esktop-efault.asp`lnga/ bcUde ]^W_ bcUde ]^W_
fghgijklTU mZno^pU fghgijklTU mZno^pU
3. 3. http7<<s6arra.wordpress.com http7<<s6arra.wordpress.com URqTU rTZs fteu_ URqTU rTZs fteu_
4. 4. www.acfga(a.co.cc www.acfga(a.co.cc vhgijklTU wYZ[\TU xuoh_ vhgijklTU wYZ[\TU xuoh_
5. 5. www.arabo.com www.arabo.com QRSTU VWSyUR\TUe VWXYZ[\TU fgS\y ]^W_ QRSTU VWSyUR\TUe VWXYZ[\TU fgS\y ]^W_
9. www. accounting education.com
.9. .9. www.pwc.com www.pwc.com
... ... www.deloitte.com www.deloitte.com
./. ./. VeRz{e fX|e eR\} ~ZZj[TU g^u k} VeRz{e fX|e eR\} ~ZZj[TU g^u k}
.0. International Accounting Standers =IAS>, presentation of financial International Accounting Standers =IAS>, presentation of financial
statements. statements.
23