ACCA

The aim of this article is to help students improve their understanding of computer-assisted techniques by giving practical illustrations of computer-based controls and the way they may feature in exam questions. Relevant to Foundation level Paper FAU and ACCA Qualification Papers F8 and P7 (Int and UK) The accounting systems of many companies, large and…

To obtain audit evidence, the auditor performs one – or a combination – of the following procedures: inspection observation external confirmation inquiry reperformance recalculation analytical procedures. It is mandatory that the auditor should perform risk assessment for the identification and assessment of risks of material misstatement at the financial statement and assertion level, and the…

How working papers provide evidence that an effective, efficient, and economic audit has been carried out. This article is about audit working papers. Auditors should prepare and organise their working papers in a manner that helps the auditor carry out an appropriate audit service. The auditor should avoid preparing or accumulating unnecessary working papers, and…

Relevant to ACCA Qualification Paper F8 This article considers the requirements of ISA 330, The Auditor’s Responses to Assessed Risks. The main objective of ISA 330 is to give guidance on how auditors should obtain sufficient appropriate evidence regarding the assessed risks of material misstatement by designing and implementing appropriate responses to those risks. UK…

This article provides guidance on various aspects of auditing in a computer-based accounting environment. Relevant to Foundation level Paper FAU and ACCA Qualification Papers F8 and P7 Specific aspects of auditing in a computer-based environment Information technology (IT) is integral to modern accounting and management information systems. It is, therefore, imperative that auditors should be…

This article considers how subsequent events can affect an entity’s financial statements, and discusses the auditing requirements AA candidates need to know. Students of financial reporting and auditing papers will have to gain an understanding of how subsequent events (also known as ‘events after the reporting period’) affect the financial statements of an entity. This…

This article will consider the various sampling methods in the context of AA and FAU. Paper F8, Audit and Assurance and Paper FAU, Foundations in Audit require students to gain an understanding of audit sampling. While you won’t be expected to pick a sample, you must have an understanding of how the various sampling methods…

This article outlines and explains the concept of audit risk, making reference to the key auditing standards which give guidance to auditors about risk assessment Relevant to FAU, F8 and P7 Identifying and assessing audit risk is a key part of the audit process, and ISA 315, Identifying and Assessing the Risks of Material Misstatement…

It is essential that candidates preparing for the Audit and Assurance (AA) exam understand the respective responsibilities of auditors and management regarding going concern. This article discusses these responsibilities, as well as the indicators that could highlight where an entity may not be a going concern, and the reporting aspects relating to going concern. Candidates…

One of the major revisions of ISA 315 relates to the inquiries made by external auditors of the internal audit function since internal auditors have better knowledge and understanding of the organisation and its internal control. This article addresses and highlights the components of internal control The International Auditing and Assurance Standards Board (IAASB) issues…

The purpose of this article is to provide candidates with a more detailed appreciation of matters pertinent to an auditor, focusing on the need for the auditor of a large limited liability company (in the UK – a limited company) to evaluate the effectiveness of the company’s control environment ISA 315, Identifying and Assessing the…

Relevant to candidates attempting Foundations in Audit and Audit and Assurance This article focuses on the audit of wages but many of the points made also apply to salaries (the term payroll covers both). The distinction between the two is that wages are normally paid weekly in cash to employees working in departments such as…

Can internal auditors be used to provide direct assistance to the external auditor for purposes of audit? Relevant to ACCA Qualification exams AA and AAA International Standard on Auditing (ISA) 610, Using the Work of Internal Auditors was revised and published in 2013. This standard focuses on whether the external auditor can use the work of the…

An important part of an external audit is the consideration by the auditor as to whether the client has complied with laws and regulations. It is important that candidates preparing for Audit and Assurance (AA) and Advanced Audit and Assurance (AAA) have an understanding of how laws and regulations affect an audit, not only in terms of…

Relevant to ACCA Qualification exams AA and AAA The International Auditing and Assurance Standards Board (IAASB) finalised its project on auditor reporting in 2015, which resulted in a set of new and revised standards on auditor reporting as well as revised versions of ISA, 570Going Concern and a number of other International Standards on Auditing (ISAs)….

This article will focus on assertions as identified by ISA 315 (Revised) and also provides useful guidance to candidates on how to tackle questions dealing with these. Interim and final audit procedures During the interim audit, the internal control system is documented and evaluated. This will determine the mix of tests of control and substantive…