Kế toán, kiểm toán - Chapter 17: Auditing and evaluating the ais

Chapter 17Auditing and Evaluating the AISOutlineExpected outcomesAudit typesGenerally accepted auditing standardsFinancial statement audit stepsExpected outcomesDescribe the various kinds of audits you might encounter in your accounting career.Explain the AICPA’s 10 generally accepted auditing standards.Discuss the basic steps associated with financial statement audits.Explain the connection between auditing and AIS.Audit typesFinancial auditIndependent examination of a company’s AIS and financial statementsCulminates in an audit opinionUnique province of CPAsOperational auditExamination of a company’s rules and procedures for doing businessClosely connected to business processes discussed earlierAudit typesSystems auditDetermines if IT employed in a system is producing expected resultsRequires strong background in both accounting and information systemsCompliance auditAudit of governmental and not-for-profit entitiesOften referred to as a “Yellow Book” auditRequires solid understanding of GNFP accounting, which can be very different from businessAudit typesManagement auditAssesses the degree to which assumptions made as part of decisions are validParticularly relevant in times of economic uncertaintyInvestigative auditAlso known as a fraud auditGathers evidence to confirm or refute occurrence of occupational fraud and abuseDoes not determine guilt or innocenceAudit typesInternational auditFocuses on:Foreign operations of US-based firmsOperations of non-US based firmsRequired knowledge goes far beyond accountingLanguageCultureLawsAudit typesLecture break 17-1All audits require some degree of professional judgment. Working with a group of students, select one of the seven audit types just presented. Give two examples of how professional judgment might be required in such an audit.Generally accepted auditing standardsAbbreviated GAASPromulgated by American Institute of CPAs (www.aicpa.org) GAAP: Rules for preparing financial statementsGAAS: Guiding principles for conducting an auditThree groups, ten standardsGenerally accepted auditing standardsGeneral standardsTrainingIndependenceProfessional careField work standardsSupervisionInternal controlEvidenceReporting standardsGAAPConsistencyDisclosureOpinionGenerally accepted auditing standardsLecture break 17-2Consider one of the following fraud cases: Enron Bernie Madoff City of Bell (California) ParmalatWhich GAAS were ignored or violated in the case you selected?Financial statement audit stepsAssess management’s integrity.Evaluate management’s credentials.Review the internal control system.Perform compliance testing.Issue the audit report.Classroom assessmentThis chapter has focused on:Types of auditsGenerally accepted auditing standardsSteps in a financial statement auditChoose one of those three topics.Working with a group of three to five students, suggest two or three questions you have about it.Trade questions with another group.Do some research to answer their questions.