Overall Audit Plan and Audit Program. Chapter 13. Midterm topic guide will be ready and posted to the website by sometime Saturday (2/25). Types of Audit Tests. Procedures to obtain an understanding of internal control (Ch 10) Focused on understanding the design and
Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.
Procedures to obtain an understanding
of internal control (Ch 10)
Focused on understanding the design and
operation of aspects of I/C necessary to plan
the rest of the audit
Tests of control (Ch 10)
Procedures used to obtain evidence
needed to assess control risk.
Substantive tests of transactions
Procedures designed to test for dollar
misstatements of financial statement
Tests of details of balances
Focus on ending G/L balances
Type of Test
Procedures for I/C
Tests of controls
Tests of details
Relationship Between Types of Tests and Evidence (Table 13-2)
from control risk
tests of control
INTERNAL CONTROL EFFECTIVENESS
Reliance on controls: C3 – None, C2 – Some, C1 – MaximumAudit Assurance at Different Levels of Internal Control Effectiveness (Figure 13-3)
SAS 80 (AU 326) and SAS 94 (AU 319)
provide guidance for auditors of entities
that transmit, process, maintain, or access
significant information electronically.
It is convenient to think of the audit program as
consisting of the three major classes of tests:
Tests of controls and
substantive tests of transactions
Tests of details and balances
and substantive tests
of transactions to meet
Assess control risk.
Determine extent of
testing controls.Designing Controls and Substantive Tests of Transactions (Figure 13-4)
Perform procedures to
Items to select
2. Perform tests of controls and substantive
tests of transactions.
3. Perform analytical procedures and tests
of details of balances.
4. Complete the audit and issue an audit report.
6. Posting and
6. Detail tie-in
7. Realizable value
8. Rights and obligations
9. Presentation and
disclosureAudit Objectives (Ch. 6)
1. Physical examination
4. Analytical procedures
6. Inquiry of the client
Gather information to assess fraud risks.
Develop overall audit plan and audit program.Summary of the Audit Process:Phase I
Set materiality and assess acceptable
audit risk and inherent risk.