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Description Detail Description

Page

No Qs Ruling

MODULE 1 -ASSURANCES SERVICES FRAMEWORK

International Auditing and Ass Stds Board (IAASB) IAASB, IAASB(2009b)-Clarity Project suggestions, ISAs 1.5, 1.8

Structure of IAASB pronouncements

The new Structure includes Introduction, objective, definition, requirements and other

explanatory materials. Figure 1.1 1.6

Historical Financial Information - audits of 1.7

Historial financial information - reviews of 1.7

Assurance engagements other than audits or reviews of

historial fin infor

Prospective fin info, non-fin performance indicators, systems or processes and

behaviour 1.7

Related services

eng'ts to perform agreed upon procedures, compiliations of fin infor, preparation of

tax returns, consulting eng'ts 1.7 Q.4

Preamble to Australian auditing stds 1.8Assurance engagements - Types Reasonable versus, Limited, differences 1.10 Q.3, Q.5 ISRE 2410, IFAE P11

Assurance engagement - elements of five - 3 party, app subject mtr, suitable crita, suff appr evidence, written ass rep 1.11

three party rel'ship practionioner, resp party and intended users 1.12 Q.6 IFAE P25

Direct reporting engagements 1.12

Assertion based engagements 1.12

Subject matter

five categories - Fin perfomance, Non-fin performance, Physical Characteristics,

Systems and Processes and Behaviour 1.13

Suitable Criteria relevance, completeness, reliability, neutrality, understandability 1.14

Sufficient appropriate evidence

Professional scepticism, sufficience and approp of evidence, materiality, ass eng'mt

risk and nature, timing and extent of evidence gathering procedures 1.16

Professional scepticism 1.16 Q.17 ISA 240 P12

Sufficiency and appropriateness of evidence qty of evidence and qlty evidence 1.17

Materiality

Materiality in context of quantitative and qualitative factors- relative magnitude, he

nate and extent of the effecto of these factors 1.17

Assurance engagement risk inherent risk, control risk, detection risk 1.18

Inherent risk 1.18

Control risk 1.18

Detection risk 1.18

Nature, timing and extent of evidence gathering procedures

two factors - reasonable ass will be less than obsolute ass, nature , timing and extend

of evidence gathering in altd ass eng'ment 1.19 Q.10

Assurance report 1.20

Financial statements audit - using the assurance framework 3 party rel'ship, subject matter, Criteria, Evidence collection, Written assurance report 1.21 Q.2

Audit judgement

Examples - understanding the entity and its enviro, assessing risk of material

misstaement, internal controls consideration of fraud and error, audit evidence,

analytical procedures, audit sampling and audit reporting 1.23

Establishing criteria 1.24

Internal controls - assurance 1.25 Q.7 IFAE P37

Internal Control - integrated framework

COSO - 1994 - objs: effectiveness and efficiency of operations, reliability of fin

reporting, compliance, 5 components - control environment, risk assessment, control

activities, infor and comm and monitoring 1.26

Enterprise Risk Management - integrated framework

4 categories: strategic, operations, reporting and compliance. 8 components: internal

environment, objective setting, event identification, risk assessment, risk response,

control activities, infor and comm, monitoring 1.30 Q.8, Q.9

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Code of Ethics for Professional Accts contents: Part A, Part B and Part C 1.32

Code of Ethics for Professional Accts - the conceptual

framework approach

integrity, objectivity, prof competence and due care, confidentiality and prof

behaviour 1.34

Threats self intt, self review, advocacy, faciliarity and intimidation 1.34

Safeguards - by profession, legislation or regulation. - by work environment 1.35 Q.12

Professional conduce - fundamental principles


behaviour 1.36 Q.14

Integrity 1.36

Objectivity 1.36

Professional competence and due care 1.36 Q.15

Confidentiality 1.37

Professional behaviour 1.37

Code of Ethics for professional accts in public practice 1.37

Professional appointment 1.37

Conflicts of interest 1.38

Incompatible activities 1.38

Conflicts between two or more clients 1.39

Second opinions 1.39

Fee and other types of remuneration 1.39

Marketing professional services 1.40

Gifts and hospitality 1.40

Custody of client assets 1.40

Objectivity - all services 1.40

Independence 1.40

Independence - a conceptual framework approach to independence of mind, independence of appearance 1.41

Independence - an application of the conceptual framework

approach to 1.42

Quality Control Report - Auditor indepedence 1.43 Q.16

Quality controls for firms that perform audits and reviews 1.44

Quality control - elements

6 key elements: leadership resp, relevant ethical req, acceptance and continuance,

human resources, engment perf, monitoring 1.45

Leadership responsibilities for quality withing the firm - QC 1.46

Ethical requirements - relevant - QC 1.46Acceptance and continuance of client rel'sp and specific eng'mts

- QC 1.47

Human resources - QC 1.48

Engagement performance - QC

eng'mt support materials, supervious and review process, consultation, eng'mt quality

control review (EQCR) 1.48

Monitoring - QC

risk reviews, compliance reviews, fin stmt desktop reiew, quality reviews - eng level,

practice unit, global operation risk mgt review, global indpendence review 1.50 Q.11 ISQC 1

Public Sector perspective 1.51

Public expenditure and financial control 1.51

Auditor-General mandate

Australia, NSW (Financial audits, Compliance audits, Performance audits, Protected

disclosures), VIC, HongKong, 1.52

MODULE 2 - GENERAL AUDIT PRINCIPLES AND AUDITOR RESPONSIBILITIES

Independent auditor - overall objectives of the independent

audit and the conduct of an audit in accordance with ISA overall objectives, nature and scope, scope authority and structure. 2.5

Q.3,

Q.1,Q.5

ISA 200 P 17, P32, OB

- P45-47

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Inherent risk inherent risk factors 2.7 Q.8,Q.11

Control risk control risk factors 2.7 Q.4 ISA 200 A 38, A39

Detection risk 2.8 Q.6,Q.19 ISA 200 P A34 - 41

Audit risk 2.7 Q.2 ISA 200 P A42

Audit engagement - terms of change of terms of an engagement 2.10 Q.9, Q17

ISA 210.10, - P 15, A

33

Engagement Letter 2.10 Q.10

Audit independence for the audit of fin'l stmts conflict of interst situation 2.14

Non-audit services 2.14

Independence test 2.14

Audit independence and US legisation non-audit services, prohibits the employment in the capacity of. 2.16

Quality control for audits 2.17

Engagement team members compliance with enthical

requirments 2.18

Acceptance and continuance of client rel'sp and specific eng'mts

- 2.19

Engagement teams - assignement of 2.19

Engagement performance eng'mt partner's direction, supervision and direction, Reviewers, Consultations 2.19 Q.20 ISA 220 P 19-21

Results of the firms monitoring process 2.21

Audit working papers - review detailed review - auditor in charge, higher level review - audit manager 2.22

Engagement partner review any queries, review working papers, review critical areas, following discussions 2.23

Audit documentation mandatory requirments, proof of evidence, significant matters 2.23 Q.21 ISA 230 P 9 A12

Audit File complete in 60 days, discard not before 7 yrs, exceptions - first, second 2.25

Auditors reponsibility to consider fraud in an audit 2.26

Fraud defined error - unintentional, fraud - intentional 2.26

Q.22,Q.2(M

7) ISA 240 P 11 A4-5, -A

Fradulent financial reporting 2.27

Management override Examples. 2.27

Misappropriation of assets theft - examples 2.27 Q.13

Professional scepticism - fraud 2.28 Q.3 (M7) ISA 240 A4

Engagement team- discussions - fraud 4 steps, 2.29 Q. 16 ISA 240 P A15

Risk assessment procedures 2.30

Fraud risk factors - consideration of factors, nature of fraud and fraud indicators 2.30Fraud Triangle incentive, opportunity, rationalise 2.31 Q.12 ISA 240 P 11 A4-A5

Incentives/pressures - fraud 4 categories. 2.31 Q.4 (M7)

Opportunities - fraud 4 corporate characteristics 2.31

Fraud - examples 2.35 Q.5 (M7)

Risks of material mistatement due to fraud identificaton and assessment 2.37 Q.7 ISA 240 P 26

Risks of material mistatement due to fraud responses to 2.37

Audit evidence - evaluation - fraud fraud 2.38

Unable to continue engagement - fraud 2.38

Documentation - fraud

Communication of audit matters with those charged withgovernance fraud 2.39 Q.14 ISA 260 P A1-A4

Audit engagement team's independence 2.39

Communicating deficiencies in internal control to those charged

with governance and management fraud 2.40

MODULE 3 -UNDERSTANDING THE ENTITY, ASSESSING RISK AND RESPONDING TO RISKSAudit Planning of financial statements nature and extent of plg, audit plg activities and procedures 3.5

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Audit strategy 4 sections 3.6

Overall Audit Strategy 3.6 Q.8 ISA 300 APPX

Audit plan - dynamic document

nature - direction and supervision, timing - when and extent how much of planned

risk ass procedures 3.7 Q.7, Q.10 ISA 300 P 12 - P12

Audit Materiality 3.9

Materiality concepts

>= 10% of base amt is material,

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Risks of material mistatement - assess the steps req to follow, examples 3.31

significant risks - identify 3.32 Q.1 ISA 315 P 28

Strategic systems approach to auditing client's systems dynamics 3.33

Strategic analysis

Impacts of strategic analysis: expectations, going conern, audit risks, control

environment 3.35

Business risks 3.36 Q.2 ISA 315 P 4 A30

Strategic risks 3.36

Strategic analysis - techniques used

Business models, SWOT analysis, PEST/PESTEL analysis, Porter's five forces, Value

chain analysis 3.37

Business models

8 components: External forces, markets/formats, stragetic mgt process, core

busimess processes, resource mgt processes , alliances, core products and services

and customers 3.38

SWOT analysis 4 factors: strengths, weaknesses, opportunities and threats 3.39 Q.5 TABLE 3.3

PEST/PESTEL analysis 4/6 factors: Political, economic, soical, tecnological - environmental and legal 3.41

Porters five forces

5 forces: Threat to new entrants, power of suppliers, intensity of industry rivalry,

power of buyers and power of substitutes 3.42

Value chain analysis

Primary activities (directly concerned with creation and deleivery of product/service)

and Supportiv activities (improve the effectivenss and efficiency of primary activities) 3.46 Q.6

Analytical procedures

Evaluative techniques (use past information) and Predictive procedures (based on

trends or relships) 3.48

Simple comparisons comparision to prior periods, bet'n locations, to budgets, to industry figures 3.49

Reasonableness tests 3.50

Ratio analysis profitablity ratios, activity ratios, liquidity ratios, financing ratios 3.50

Responding to assessed risks key principles 3.57

Tests of control 3.58

Substantive procedures analytical procedures, tests of details 3.58

Evaluation on misstatements identified during the audit

misstatements results in : inaccuracies in data, omissions , incorrect accts estimates,

judgement of mgt. 3.59

MODULE 4 - THE AUDITOR'S RESPONSE TO ASSESSED RISKS

Sufficient appropriate audit evidence

key principles: sufficiency relates to qty of audit evidence, appropriateness -

relevance and reliability of audit evidence 4.5

Audit evidence external evidence, internal evidence, audit evidence - original docs 4.6 Q.13(M1)

Financial stmt assertions classes of transactions and events, account balances, presentation and disclosure 4.6

Audit procedures

1. tests of control and 2. substantive procedures:a. Tests of details, substantivie

analytical procedures 4.7

Tests of control

2. objectives of tests of controls:to obtain evidence whether the controls operatede as

documentss, to confirm whether the controls functioned effectively throught the

period of reliance 4.8Tests of control procedures 4.9

Test data test data approach, steps for running test data 4.10 Q.8, Q9

Integrated test facility (ITF) ITF technique, main adjs and dis-adjs 4.12 Q.13

Testing controls - other tecnhiques, in IT systems

Processing approaches: controlled processing, controlled re-processing, parallel

processing - simulation, Non-Processing approaches: program code review(detailed

review), Review of job accounting data (higher level review) 4.13

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Computer assisted techniques for testing controls in IT systems

IT knowledge and exp available to the audit team, impracticality of manual tests of

control, efficiency and effectiveness, timing 4.14

Sampling techniques for testing controls

100% examinations, selective examinations (high value, key items, items over certain

amt), audit sampling 4.15

Sample selection Random, systematic, haphazard 4.16 Q.5, Q4 ISA 530 APPX 4

Substantive audit procedures 4.16

Analytical audit procedures

Nature of analytucal procedures, Factors effecting the use of analy. Procedures

(availability of reliable data, level of aggregation of data), the use of analy.

Procedures as reasonableness tests 1.17 Q.6

Analytical procedures and other audit procedures -

realationship 1.19

Tests of details nature of tests, tests of transactions and account balances 4.21

Tests of account balances - types external confirmations, bank confirmations, attendance at physical inventory counts 4.22 Q.3, Q.7 ISA 505 P 15 A23

Audit software - using for substantitve testing GAS, PNP. UP 4.25

Q.1, Q.2,

Q.12

Generalised audit software (GAS) functions of GAS Q.10, Q.11

Purpose written programs 4.26

Utility programs and systems mgt programs Adjs and dis-adjs of utility and systems mgt prgs 4.26 Q.14

Sampling techniques in substantive procedures Dollar unit sampling, evaluation of substantive sample results 4.28

Evidence gathering issues - advanced audit procedures for assessing going concern issues 4.30

Accounting estimates - audit procedures for 4.30

Related parties - audit procedures for factors to consider 4.31

Other auditors and experts - using the work of 3 standards 4.33

Component auditors

esp work of other auditors (component auditors) who perfom work on related

component for a group eg subsidiary 4.33

Internal auditors considerations, evaluations 4.34

Expert's auditors - auditor's experts 4.35

E-commerce environment - evidence gathering in

tests of control in e-commerce environment, substantive testing in an e-commerce

environemnt 4.35

CAATS - use in an e-commerce environment 4.36 Q.17

Small businesses - audit of SMEs, small and medium sized enterprises 4.39

Small businesses - internal controls in 4.40

Small business audits - audit approach 4.42Subsequent events auditors responsibilites, applicable audit procedures, specific procedures, 4.44 Q.15

Completion 4.45

Management representation letters 4.46 Q.16

Solicitor's representation letters 4.47

Checklist - audit completion 4.47

MODULE 5 - REPORTING REQUIREMENTS

Reports associated witha reasonable assurance engagements 5.6

Reporting responsibilities for audits of financial statements 5.6

Reporting to shareholders reporting responsibilities 5.6

Reporting to a regulatory body ASIC 5.7

Reporting to those charged with governance and management

board of directors, audit committee and other persons having responsibility of

verseeing the starategic direction of an entity and mgt . Responsibility of audit is to

report to those charged with governance and anot to mgt 5.8

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Audit committee - communications with the 5.9

Management letter 5.10

Types of auditor's reports 5.10

Unmodified auditors report example 5.11

Modifications to the auditors opinion qualified, an adverse and a disclaimer of popinion 5.14

Qualified opinion example 5.15

Adverse opinion example 5.16

Disclaimer of opinion example 5.17

Q.1,Q.2,

Q.8 ISA 580 19-20

Matters giving rise to a modified opinion and the type of

modification TABLE 5.1 5.18

Q.3,Q.4,

Q.5

Material misstatement 5.18

Matters that do not affect the auditors opinion Emphasis of matter paragraph and other matters paragraph 5.20 Q.6

Emphsis of matter paragraph example 5.20

Other matters paragraph 5.21

Materiality and Pervasiveness 5.21

Pervasiveness

5.21,5.1

4

Comparative information - audit implications of corresponding figures, comparative financial stmts. ISA 710.2 5.23

Auditors responsibilities relating to other information in

documents containing audited financial stmts 5.25

Fair presentative and compliance frameworks (true and fair

overide) acknowledge explicitly and implicitly about fair presentation 5.26

Specialised areas - audits of special considerations, ISA 800, ISA 805, ISA 810 5.27

Special purpose frameworks - audits of fin stmts prepared in

accordence tax basis, cash receipts, finan rep provision, etc 5.27

Specific elements - audits of single financial stmts and specific

elements, accounts or items of a fin stmt 5.28

Summary financial statments 5.29 Q.14

Conscise financial reports - auditor's reports on 5.29

Public sector - reports issued by the external auditor in the 5.30

Auditors general's reports 5.31

Parliament - report to 5.31

Audit recommendations 5.31Limited assurance - reports providing - reviews two stds: ISRE 2410, ISRE 2400 5.32

Review of interim and other financial info performed by the

auditor of the entity report on review of interim fin info 5.33

Reviews of finan infor where the assurance provider is not the

auditor of the entity 5.33

Reviews of other historical financial information 5.34

Historical financial information - reviews 5.34

Continuous disclosure 5.34

No assurance - reports providing 5.35

Compiliation reports ref as unaudited, compiled without audit or review 5.35Agreed upon procedures no opinion, no assurance 5.36

Agreed upon procedures - Reporting considerations 5.36

MODULE 6 - UNDERTAKING AN AUDIT OF A FINANCIAL STATEMENTCS: the audit of eagle cliff ltd 6.4

Client continuance: CS 6.9

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CS 1: Reviewing client continuance and sending an engagement

letter on a continuing engagement 6.9

Ethical considerations: CS 6.10

CS 2: Ehtical considerations 6.10 CODE OF ETH 290 23

Identifying and assessing the risks of material msistatement

thru understanding the entity and its environment: CS

risk associated with doing business in international mkts, type of ind, selfdependencu, politicals risks, eco risks, competitive risks,oper risks and human

resource risk 6.10 ASA 315.A12 - 26

CS 3: Identifying and assessing the risks of material

misstatement thru understanding the entity and its invironment 6.11

CS 4: Preliminary analytical procedures and assessing the risks

of material misstatement 6.13

Assessing the risk of material misstatement in the sales, a/r,

cash receipts system: CS

sales and a/r, internet booking sys, cash collection, recording of the cost of sales,

sales adj 6.15

CS 5: Assessing the risk of material misstatement in the

sales/a/r, cash receipt system 6.18

CS 6: Response to assessed risks: Tests of control 6.18

CS 7: Response to assessed risks: Substantive tests of accounts

rec 6.19

CS 8: Using audit software to analyse the a/r master file 6.19

Completing the audit and audit reporting considerations : CS 6.20

CS 9: Identification and resolution of audit differences 6.20

CS 10: Audit reporting 6.21

MODULE 7 -THE AUDITOR'S RESPONSIBILITIES RELATING TO FRAUD IN AN AUDIT OF A FINANCIAL STATEMENTFraud incentive for fraud, opportunity for fraud, attitude for fraud 7.4

Fraud survey 7.4

Risk of fraud CS:1 7.6

Charged with governance and of mgt - responsibility of those 7.8

Managements responsibility for fraud CS:2

Material misstatements due to fraud - auditors reponsibilties channel stuffing 7.9 Q.1

Professional scepticism CS:3 7.10

Engagement team communications significant risks 7.11

Audit team communications and fraud CS: 4 7.12

Risk assessment procedures

fraud triangle, ISA 240 Appendix 1 risk factors for fradulent fin reporting and

misappropriation of assets 7.12

Fraud risk in an uncertain economic environment material misstatement due to fraud 7.13

Charged with governence - Enquiries and obtaining an

understanding of oversignt exercised by those 7.13

Enquiries Management 7.13 Q.8 ISA 240 17Risk assessment procedures and other infor CS:5 7.14

Fraud risk assessment program CS: 6 7.14

Risk assessment procedures and mgt oversignt CS: 7 7.16

Unusual and unexpected relationships - evaluations of 7.17

Risk assessment thru analytical procedures CS: 8 7.17

Risk assessment procedures and fraud risk factors CS: 9 7.19

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Identifying and assessing the risks of material msistatement

due to fraud related party transactions 7.19

Identification and assessment of risk of material misstatement

due to fraud CS: 10 7.20

Material misstatement due to fraud - response to assessed risks 7.21audit of accounting estimates 7.21

fraud and audit procedures - circumstances that indicate the

possibility of 7.22


Misappropriation of assets 7.22

Responde to assessed risk : reviewing the general journal CS:

11 7.23

Evidence gathering and impact of management override of

controls CS: 12 7.24

Management representations 7.25

Management representations CS: 13 7.25

Communications to mgt and with those charged with

governance 7.26

The auditors responsibility if fraud is detected CS:14 7.26

Continue the engagement - auditor unable to 7.26

Communications to regulators and enforcement authories 7.27 Q.10 ISA 240 A64

Continuing the audit CS: 15 7.27

MODULE 8 - THE AUDITOS'S RESPONSIBILITY TO CONSIDER THE GOING CONCERN ASSUMPTION IN THE AUDIT OF A FINANCIAL STATEMENGoing concern assumption 8.4

Going concern assumption - The auditors assessment 8.5

Going concern - Responsibilities of management degree of uncertainity, size and complexity, subsequent events. ISA 570.A2 8.7

Going concern - Auditor's responsibilities ISA 570.9 8.8

Going concern - plg the audit and performing risk assessment

procedeures 8.9 Q.4

Going concern - evaluating mgt's assessment of GCA

relevant periods: 12 mths fm the date of auditors current report to the expected date

of the nedxt auditors report. 8.11

Q.1, Q.2,

Q.3

ISA 570 AUS 13.1 - A

12 & A7

Going concern - in uncertain or difficult economic environment 8.12

Going concern - Period beyong mgt's assessment 8.12

Extrapolating financial information Going concern 8.13

Unusual and unexpected relationships - consideration Going concern - audit software commonly used to evaluate GCA 8.13 Q.4, Q.5

Going concern - additional audit procedures when events or

conditions are identified cash flow info, budgets, forcasts, debenture trust deeds, loan agreements 8.16

Mitigating circumstances Going concern, egs, potential mitigating factors 8.19

Confirmation and evaluation of financial support Going concern 8.21

Comfort letters Letters of support and letters of subordination 8.21Letter of support provide fin assistance for fixed period of ususally 12 mths 8.21

Letter of subordination not to demand repayment of debts for a fixed period usually for 12 mths 8.21

Going concern assumption in a small business 8.22

Going concern - audit conclusions and reporting 8.22

Going concern assumption is appropriate opinions and egs 8.23 Q.8 ISA 570 18-19

Going concern assumption is non appropriate opinions and egs 8.23 Q.9, Q.10 ISA 570 17,18,19 - 2

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Communications with those charged with governance Going concern 8.24

Other reporting considerations Insolvent trading 8.25

Insolvent trading Going concern 8.25

MODULE 9 - PERFORMANCE ENGAGEMENTSPerformance engagements - Definition and scope economy, efficiency and effectivements - mgt resources. ASAE 3500 9.7 Q.1, Q.1O

Performance audit engagement

reasonable assurance, reduce risk to acceptably low level, basis for positive form of

expression of the assurance 9.8

Performance review engagement

limited assurance, reduce risk to a leve that is acceptable in the circumstances, basis

for a negative form of expression of the assurance 9.8

Economy lowest cost

9.9,

9.20

Efficiency maximise output for any given set of resource inputs, , Efficiency indicators, Egs.

9.9,

9.20 Q.5

Effectiveness

achievement of objs or other intended effects of activities, ends orientated concept

rather than means orientated. Outcomes are the effectiveness of prgs.

9.10,9.21,

9.33

performance audit - key themes 9.10

understanding performance audits 9.10

Performance audit from start to finish

planning - understand the org, prg or activity, conducting an audit - decide what to

audit, forming opinions - decide how to audit and reporting - decide what and how to

report 9.11 Q.15

Materiality - performance audit 9.12

Sufficiency - performance audit 9.12

Documentation - performance audit 9.12Difference bet'n financial audit and performance audit 9.13

Accountability and audits - performance audit

client - parliament, resp party - executive govt, assurance provider - auditor general.

Egs of accountability 9.14

Independence and quality control - performance audit 9.15

Appoinment and removal of auditor general

appointed by governor general on the recommendation of relevant minister for term

of 10 yrs, can only be removed by governor general if both houses of the parliament

make such a recommendation to GG 9.16

Policy issues - performance audit 9.16 Q.9

Performance audits - how are they selected in consultation with the parliament - ANAO, egs of performance audits 9.17 Q.7, Q.14

Improved economy Table 9.2 9.22 Q.5

Improved efficiency Table 9.2 9.22

Improved effectiveness Table 9.2 9.23 Q.8

Audit criteria - performance audit general criteria, specific criteria, established criteria, specifically developed criteria 9.24 Q.1

Criteria - egs - performance audit egs 9.25

Audit considerations - performance audit evidence, key issues, physical, testimonial, documentation and analytical 9.26 Q.3

Cause and effect cause - reason why something happened, effect - a conclusion may be quatifiable 9.28 Q.2

Attribution - Performance audit problems of assessing effectiveness 9.29

Significance - Performance audit professional judgement 9.30

Economy, efficiency and effectiveness - techniques for

examining Figure 9.2 9.31

Inputs/outputs review Performance audit 9.31

System based review Performance audit 9.31

Comparisions Performance audit - 4 methods 9.32

Effectivenss reviews

data sources for effectiveness reviews, - citizen surveys, trained observer ratings,

comparision of similar prgs, internal records, Egs 9.35

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Management performance - performance audit considerations in assessing management performance 9.37

Performance indicators

relative: to targets/goals, to previous performance, to the performance of similar

athorities. P I applied on: ongoing, periodic 9.39

Types of indicators - performance Inputs, outputs, outcomes, resources 9.40 Q.4

Inputs - Performance audit Egs. 9.41

Outputs - performance audit Egs. 9.41

Outcomes - performance audit Egs. 9.41

Cost - effectiveness - ongoing monitoring Performance audit 9.42

Performance indicators - users of parliament, public,media, client grps and research grps 9.42

Performance indicators - attributes of meaningful PI

relevant, quantifiable, verifiable, free from bias, appropriate, fair presentation,

balanced, cost effective 9.42

Outcome indicators - effectiveness egs 9.43 Q.6

Service indicators - effectiveness egs 9.43

Productivity indicators - efficiency egs 9.43

Output indicators - activity level egs 9.43

Cost - effectiveness indicators - effectiveness egs 9.43

Performance audit process

5 stages: Project identification stg, planning stg, audit conduct stg, reporting stg,

follow up stg. Figure 9.4 9.44

Project identification stage - Perform'ce audit process

1. select the org, prg or activity for audit, 2.Identify potential audit topics based on

significance, risk to good mgt and potential benefits. 9.45 Q.15

Planning stage - Perform'ce audit process. ASAE 3500.32

3. Gain an understanding of the org, prg or activity subject to audit, 4.Undertake

preliminary study by identigying fundamental issues, 5. Prepare the preliminary study

report, 6. Discuss the preliminary report, 7. Develop detailed audit criteria, 8. Develop

audit plan including audit program 9.46 Q.12

Audit conduct stage - Perform'ce audit process

9. carry out audit procedures as defined in the audit prg, 10. analyse evidence and

evaluate findings to develop conclusions and recommendations, 11. communicate

summary of draft findings and proposed recommentations to the head of org and

minister 9.47

Reporting stage - Perform'ce audit process

12. report to the head of org, minster and parliament - assurance report content,

assertion based rep and direct rep 9.49

Assertion based reporting Performance audit 9.51

Direct reporting Perfromance audit 9.51

Follow up stage - Perform'ce audit process Follow up and report on conclusions and recommendations 9.52

Performance audit on the auditor general's office atleast once in 3 yrs, report to be transmitted to each house of parliament within 7sitting days 9.52

MODULE 10 -OTHER ASSURANCE SERVICES AND INTERNAL AUDIT

Assurance Engagements - framework 3 party rel'ship, subject matter, Criteria, Evidence collection, Written assurance report 10.5 Q.1

Assurance Engagements - nature 10.5

Independence and Professional reputation 10.6 Q.2

Professional Judgement - Quality - expertise 10.7

Survey of assurance services being provided 10.7 Q.6

Prospective financial information - assurance on 10.10 Q.10

AUS 804 - P 10 Theaudit of prospective

finan info

Prospective financial information - guidance on ICEAW Relevant, Understandable, Reliable, Comparable 10.12 Q.7 AUS 804 P 9

Non-Financial information - assurance on Environmental and Sustainability assurance 10.13

Environmental report 10.14

Sustainability report 10.14

Triple bottom line reporting - CPA Aus Inquiry, Observation, Inspection, Computation, Confirmation, Anal procedures 10.17 Q.8

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Sustainability assurance - Frameworks for 10.18

Historical Financial Information

Eng acceptance, plg and per, imp or isae 3000, ontaining evidence, documentation,

prepare ass rep 10.19

ISAE 3000 - Ass

Engmts other than

audits or reviews of hi

fin info

Sustainability reporting - assurance on Phase I, Phase II, 10.20

AA1000 - Assurance S

(AA1000AS)

Sustainability assurance - recent surveys of insights and inadequacies 10.22

Sustainability assurance - new developments Assurance on carbon emmission dis, ass on water accts reports 10.23

Sustainability assurance subject matter, criteria, key per ind, evidence gathering, reporting on conculsion 10.25

Non-Financial information - Business Performance measurment Ass'g the reliability of infor and ass'g the relevance of perf meas 10.28

Performance measurement assurance - criteria

relevant, avoids perverse incentives, attributable, well defined, timely, reliable,

comparable, verifiable 10.29 Q.5

Key Performance measures 10.31

Internal control - assurance 1st, 2nd, 3rd and 4th phase 10.32 Q.3

Systems and Processes - assurance on 10.32

COSO (1994) reporting to external parties 10.33

Control environment

Integrity and ethical values, Commitment to competence, board of directors or audit

committee, mgr phil and op style, org structure, assign ment of auth and resp, human

res 10.34

Risk assessment 10.36

Control activities 10.39

Information and communication 10.39Monitoring 10.40

COSO (1994) reporting guidelines 10.41 Q.4

Risk Management assurance 10.42

Privacy assurance - Systems reliability 10 principles 10.44 Q.12

Behaviour - assurance on two forms 10.46 Q.6

Corporate governance assurance 8 principles 10.47

Continuous auditing direct and indirect reporting 10.49 Q.11

Core competencies for potential assurance services

customer focus, migration to higher val added infor, infor tech, pace of change and

complexity, competition 10.54

Internal audit - overview Key issues 10.56 Q.13audit committee reporting 10.59 Q.14

Internal audit - engagement planning 10.60

Internal audit - carrying out the engagement 10.61 Q.15

Internal audit - reporting 10.62

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Description Description Detail

Page

No Qs Ruling

Acceptance and continuance of client rel'sp and specific eng'mts - 2.19

Acceptance and continuance of client rel'sp and specific eng'mts -QC 1.47

Accountability and audits - performance audit

client - parliament, resp party - executive govt, assurance provider - auditor general.

Egs of accountability 9.14

Accounting estimates - audit procedures for 4.30

Adverse opinion example 5.16

Agreed upon procedures no opinion, no assurance 5.36

Agreed upon procedures - Reporting considerations 5.36

Analytical audit procedures

Nature of analytucal procedures, Factors effecting the use of analy. Procedures

(availability of reliable data, level of aggregation of data), the use of analy.

Procedures as reasonableness tests 1.17 Q.6




Analytical procedures and other audit procedures - realationship 1.19

Application controls

Appoinment and removal of auditor general

appointed by governor general on the recommendation of relevant minister for term

of 10 yrs, can only be removed by governor general if both houses of the parliament

make such a recommendation to GG 9.16


Assertion based reporting Performance audit 9.51

Assertions - Financial statement

Classes of transactions : Occurance, Completeness, Accuracy, Cutoff & Classification,

Account balances: Existence, Rights and obligations, Completeness, Valuations and

allocations, Presentation and Disclosure: Occurance and rights and obligations,

Completeness, Classification and understandability, Accuracy and Valuation 3.12

Q.11,Q.12,

Q.13,Q.14,

Q.15,Q.16

Assessing the risk of material misstatement in the sales, a/r,

cash receipts system: CS

sales and a/r, internet booking sys, cash collection, recording of the cost of sales,

sales adj 6.15

Assessing the risk of material misstatement in the sales/a/r,

cash receipt system - CS 5 6.18



Assurance Engagements - framework 3 party rel'ship, subject matter, Criteria, Evidence collection, Written assurance report 10.5 Q.1

Assurance Engagements - nature 10.5

Assurance engagements - Types Reasonable versus, Limited, differences 1.10 Q.3, Q.5 ISRE 2410, IFAE P11

Assurance engagements other than audits or reviews of historial

fin infor Prospective fin info, non-fin per indi, systems or processes and behaviour 1.7


Attribution - Performance audit problems of assessing effectiveness 9.29

audit committee reporting 10.59 Q.14

Audit committee - communications with the 5.9

Audit conduct stage - Perform'ce audit process

9. carry out audit procedures as defined in the audit prg, 10. analyse evidence and

evaluate findings to develop conclusions and recommendations, 11. communicate

summary of draft findings and proposed recommentations to the head of org and

minister 9.47

Audit considerations - performance audit evidence, key issues, physical, testimonial, documentation and analytical 9.26 Q.3

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Audit criteria - performance audit general criteria, specific criteria, established criteria, specifically developed criteria 9.24 Q.1



ISA 210.10, - P 15, A

33






Audit independence for the audit of fin'l stmts conflict of interst situation 2.14

Audit judgement





audit of accounting estimates 7.21




Audit Planning of financial statements nature and extent of plg, audit plg activities and procedures 3.5

Audit procedures



Audit recommendations 5.31

Audit reporting - CS 10 6.21


Audit software - using for substantitve testing GAS, PNP. UP 4.25 Q.1, Q.2,Q.12


Audit team communications and fraud CS: 4 7.12





Auditors general's reports 5.31


Auditors responsibilities relating to other information in

documents containing audited financial stmts 5.25Behaviour - assurance on two forms 10.46 Q.6

Business models



and customers 3.38

Business risks 3.36 Q.2 ISA 315 P 4 A30

CAATS - use in an e-commerce environment 4.36 Q.17

Cause and effect cause - reason why something happened, effect - a conclusion may be quatifiable 9.28 Q.2

Charged with governance and of mgt - responsibility of those 7.8Charged with governence - Enquiries and obtaining an

understanding of oversignt exercised by those 7.13

Checklist - audit completion 4.47

Client continuance: CS 6.9


Code of Ethics for Professional Accts - the conceptual framework

approach


behaviour 1.34


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Comfort letters Letters of support and letters of subordination 8.21



Communication of audit matters with those charged with

governance fraud 2.39 Q.14 ISA 260 P A1-A4

Communications to regulators and enforcement authories 7.27 Q.10 ISA 240 A64

Communications to mgt and with those charged with governance 7.26

Communications with those charged with governance Going concern 8.24

Comparative information - audit implications of corresponding figures, comparative financial stmts. ISA 710.2 5.23

Comparisions Performance audit - 4 methods 9.32

Compiliation reports ref as unaudited, compiled without audit or review 5.35

Completing the audit and audit reporting considerations : CS 6.20

Completion 4.45

Component auditors

esp work of other auditors (component auditors) who perfom work on related

component for a group eg subsidiary 4.33




Computer operation controls 3.23


Confirmation and evaluation of financial support Going concern 8.21

Conflicts between two or more clients 1.39


Conscise financial reports - auditor's reports on 5.29

Continue the engagement - auditor unable to 7.26

Continuing the audit CS: 15 7.27

Continuous auditing direct and indirect reporting 10.49 Q.11

Continuous disclosure 5.34

Control activities

authorisation, performance reviews, info processing, physical controls , segregation of

duties 3.20

Control activities 10.39

Control environment tone of organisations 3.19

Control environment

Integrity and ethical values, Commitment to competence, board of directors or auditcommittee, mgr phil and op style, org structure, assign ment of auth and resp, human

res 10.34

Control risk 1.18


Controls - types of General controls, Application controls - Table 3.1 3.21

Controls in an IT environment 8 factors - inmpact of an IT environment on internal control and control procedures 3.20

Core competencies for potential assurance services

customer focus, migration to higher val added infor, infor tech, pace of change and

complexity, competition 10.54

Corporate governance assurance 8 principles 10.47COSO (1994) reporting guidelines 10.41 Q.4

COSO (1994) reporting to external parties 10.33

Cost - effectiveness - ongoing monitoring Performance audit 9.42

Cost - effectiveness indicators - effectiveness egs 9.43

Criteria - egs - performance audit egs 9.25

CS: the audit of eagle cliff ltd 6.4


Data entry and program controls 3.24

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Detection risk 1.18


Difference bet'n financial audit and performance audit 9.13

Direct reporting Perfromance audit 9.51


Disclaimer of opinion example 5.17Q.1,Q.2,Q.8 ISA 580 19-20


Documentation - performance audit 9.12

E-commerce environment - evidence gathering in

tests of control in e-commerce environment, substantive testing in an e-commerce

environemnt 4.35

Economy lowest cost

9.9,

9.20

Economy, efficiency and effectiveness - techniques for examining Figure 9.2 9.31

Effectiveness

achievement of objs or other intended effects of activities, ends orientated concept

rather than means orientated. Outcomes are the effectiveness of prgs.

9.10,

9.21,

9.33

Effectivenss reviews

data sources for effectiveness reviews, - citizen surveys, trained observer ratings,

comparision of similar prgs, internal records, Egs 9.35

Efficiency maximise output for any given set of resource inputs, , Efficiency indicators, Egs.

9.9,

9.20 Q.5

Ehtical considerations - CS 2 6.10 CODE OF ETH 290 23

Emphsis of matter paragraph example 5.20

Engagement Letter 2.10 Q.10






Engagement team communications significant risks 7.11


Engagement team members compliance with enthicalrequirments 2.18


Enquiries Management 7.13 Q.8 ISA 240 17





Entity and its environment - including internal control 3.17

Entity's risk assessment procsss 3.19

Environmental report 10.14Establishing criteria 1.24

Ethical considerations: CS 6.10

Ethical requirements - relevant - QC 1.46




Evidence gathering and impact of management override of

controls CS: 12 7.24

Evidence gathering issues - advanced audit procedures for assessing going concern issues 4.30

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Expert's auditors - auditor's experts 4.35

Extrapolating financial information Going concern 8.13

Fair presentative and compliance frameworks (true and fair

overide) acknowledge explicitly and implicitly about fair presentation 5.26




Follow up stage - Perform'ce audit process Follow up and report on conclusions and recommendations 9.52



Fraud incentive for fraud, opportunity for fraud, attitude for fraud 7.4


fraud and audit procedures - circumstances that indicate the

possibility of 7.22


Q.22,Q.2(M

7) ISA 240 P 11 A4-5, -

Fraud risk assessment program CS: 6 7.14

Fraud risk factors - consideration of factors, nature of fraud and fraud indicators 2.30

Fraud risk in an uncertain economic environment material misstatement due to fraud 7.13

Fraud survey 7.4

Fraud Triangle incentive, opportunity, rationalise 2.31 Q.12 ISA 240 P 11 A4-A5

General controls 3.22 Q.17, Q.18

Generalised audit software (GAS) functions of GAS Q.10, Q.11


Going concern - additional audit procedures when events or

conditions are identified cash flow info, budgets, forcasts, debenture trust deeds, loan agreements 8.16

Going concern - audit conclusions and reporting 8.22

Going concern - Auditor's responsibilities ISA 570.9 8.8

Going concern - evaluating mgt's assessment of GCA

relevant periods: 12 mths fm the date of auditors current report to the expected date

of the nedxt auditors report. 8.11

Q.1, Q.2,

Q.3

ISA 570 AUS 13.1 -

12 & A7

Going concern - in uncertain or difficult economic environment 8.12

Going concern - Period beyong mgt's assessment 8.12

Going concern - plg the audit and performing risk assessment

procedeures 8.9 Q.4

Going concern - Responsibilities of management degree of uncertainity, size and complexity, subsequent events. ISA 570.A2 8.7

Going concern assumption 8.4

Going concern assumption - The auditors assessment 8.5

Going concern assumption in a small business 8.22

Going concern assumption is appropriate opinions and egs 8.23 Q.8 ISA 570 18-19

Going concern assumption is non appropriate opinions and egs 8.23 Q.9, Q.10 ISA 570 17,18,19 - 2


Historical Financial Information

Eng acceptance, plg and per, imp or isae 3000, ontaining evidence, documentation,

prepare ass rep 10.19

ISAE 3000 - Ass

Engmts other than

audits or reviews of

fin info


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Historical financial information - reviews 5.34


Identification and assessment of risk of material misstatement

due to fraud CS: 10 7.20

Identification and resolution of audit differences - CS 9 6.20

Identifying and assessing the risks of material misstatement thru

understanding the entity and its invironment - CS 3 6.11

Identifying and assessing the risks of material mistatement

through understanding the entity and its environment 3.15

Identifying and assessing the risks of material msistatement due

to fraud related party transactions 7.19

Identifying and assessing the risks of material msistatement thru

understanding the entity and its environment: CS

risk associated with doing business in international mkts, type of ind, self

dependencu, politicals risks, eco risks, competitive risks,oper risks and human

resource risk 6.10 ASA 315.A12 - 26

Improved economy Table 9.2 9.22 Q.5

Improved effectiveness Table 9.2 9.23 Q.8

Improved efficiency Table 9.2 9.22



Independence 1.40



approach to 1.42

Independence and Professional reputation 10.6 Q.2

Independence and quality control - performance audit 9.15




Q.3,

Q.1,Q.5

ISA 200 P 17, P32,

OBJS - P45-47

Information and communication 10.39

Information system 3.20

Inherent risk 1.18


Input controls

proper authorisation, accurate conversion, completeness of data( record counts, batch

totals, hash totals, check digits), error correction and data resubmission 3.26

Inputs - Performance audit Egs. 9.41

Inputs/outputs review Performance audit 9.31

Insolvent trading Going concern 8.25


Integrity 1.36

Internal audit - carrying out the engagement 10.61 Q.15

Internal audit - engagement planning 10.60Internal audit - overview Key issues 10.56 Q.13

Internal audit - reporting 10.62

Internal Auditing and Ass Stds Board (IAASB) ISSAB, ISSAB(2009b), ISAs 1.5, 1.8

Internal auditors considerations, evaluations 4.34

Internal control - assurance 1st, 2nd, 3rd and 4th phase 10.32 Q.3

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Internal controls 5 components 3.18


Key Performance measures 10.31


Letter of subordination not to demand repayment of debts for a fixed period usually for 12 mths 8.21

Letter of support provide fin assistance for fixed period of ususally 12 mths 8.21

Limited assurance - reports providing - reviews two stds: ISRE 2410, ISRE 2400 5.32

Management letter 5.10


Management performance - performance audit considerations in assessing management performance 9.37

Management representation letters 4.46 Q.16

Management representations 7.25

Management representations CS: 13 7.25

Managements responsibility for fraud CS:2


Material misstatement 5.18

Material misstatement due to fraud - response to assessed risks 7.21

Material misstatements due to fraud - auditors reponsibilties channel stuffing 7.9 Q.1

Materiality



Materiality - performance 3.11

Materiality - performance audit 9.12

Materiality and Pervasiveness 5.21

Materiality concepts

>= 10% of base amt is material,

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Organisational and management controls 2 factors 3.22

Other auditors and experts - using the work of 3 standards 4.33

Other general IT controls Backup and recovery procedures, physical safeguards, contingency plans 3.25

Other matters paragraph 5.21Other reporting considerations Insolvent trading 8.25

Outcome indicators - effectiveness egs 9.43 Q.6

Outcomes - performance audit Egs. 9.41

Output controls 3.30

Output indicators - activity level egs 9.43

Outputs - performance audit Egs. 9.41


Parliament - report to 5.31

performance audit - key themes 9.10

Performance audit engagement

reasonable assurance, reduce risk to acceptably low level, basis for positive form of

expression of the assurance 9.8

Performance audit from start to finish

planning - understand the org, prg or activity, conducting an audit - decide what to

audit, forming opinions - decide how to audit and reporting - decide what and how to

report 9.11 Q.15

Performance audit on the auditor general's office

atleast once in 3 yrs, report to be transmitted to each house of parliament within 7

sitting days 9.52

Performance audit process

5 stages: Project identification stg, planning stg, audit conduct stg, reporting stg,

follow up stg. Figure 9.4 9.44

Performance audits - how are they selected in consultation with the parliament - ANAO, egs of performance audits 9.17 Q.7, Q.14

Performance engagements - Definition and scope economy, efficiency and effectivements - mgt resources. ASAE 3500 9.7 Q.1, Q.1O

Performance indicators

relative: to targets/goals, to previous performance, to the performance of similar

athorities. P I applied on: ongoing, periodic 9.39

Performance indicators - attributes of meaningful PI

relevant, quantifiable, verifiable, free from bias, appropriate, fair presentation,

balanced, cost effective 9.42

Performance indicators - users of parliament, public,media, client grps and research grps 9.42

Performance measurement assurance - criteria

relevant, avoids perverse incentives, attributable, well defined, timely, reliable,

comparable, verifiable 10.29 Q.5

Performance review engagement

limited assurance, reduce risk to a leve that is acceptable in the circumstances, basis

for a negative form of expression of the assurance 9.8

Pervasiveness

5.21,5.1

4


Planning stage - Perform'ce audit process. ASAE 3500.32

3. Gain an understanding of the org, prg or activity subject to audit, 4.Undertake

preliminary study by identigying fundamental issues, 5. Prepare the preliminary study

report, 6. Discuss the preliminary report, 7. Develop detailed audit criteria, 8. Develop

audit plan including audit program 9.46 Q.12

Policy issues - performance audit 9.16 Q.9

Porters five forces

5 forces: Threat to new entrants, power of suppliers, intensity of industry rivalry,

power of buyers and power of substitutes 3.42

Preamble to Australian auditing stds 1.8

Preliminary analytical procedures and assessing the risks of

material misstatement - CS 4 6.13

Privacy assurance - Systems reliability 10 principles 10.44 Q.12

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Processing controls

completeness and accuracy of data ( control totals, run to run controls, field size test,

field sign test, trasaction codes, check digit test, valid character test, sequence test,

validity test, cross footing test, zero balancing test, audit trail, completeness test,

rounding test, per cent error test) maintaining accuracy during processing ( control

totals, console messages, error log, limit test, reasonable test) Reasonableness ofdata ( limit test, range test, reasonableness test) updating correct files (internal

labels, external labesl) 3.28

Productivity indicators - efficiency egs 9.43






behaviour 1.36 Q.14

Professional Judgement - Quality - expertise 10.7



Professional scepticism CS:3 7.10

Project identification stage - Perform'ce audit process

1. select the org, prg or activity for audit, 2.Identify potential audit topics based on

significance, risk to good mgt and potential benefits. 9.45 Q.15

Prospective financial information - assurance on 10.10 Q.10

AUS 804 - P 10 The

audit of prospective

finan info

Prospective financial information - guidance on ICEAW Relevant, Understandable, Reliable, Comparable 10.12 Q.7 AUS 804 P 9


Public sector - reports issued by the external auditor in the 5.30


Purpose written programs 4.26

Qualified opinion example 5.15









Related parties - audit procedures for factors to consider 4.31

Related services



Reporting responsibilities for audits of financial statements 5.6

Reporting stage - Perform'ce audit process

12. report to the head of org, minster and parliament - assurance report content,

assertion based rep and direct rep 9.49Reporting to a regulatory body ASIC 5.7

Reporting to shareholders reporting responsibilities 5.6

Reporting to those charged with governance and management

board of directors, audit committee and other persons having responsibility of

verseeing the starategic direction of an entity and mgt . Responsibility of audit is to

report to those charged with governance and anot to mgt 5.8

Reports associated witha reasonable assurance engagements 5.6

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Responde to assessed risk : reviewing the general journal CS:

11 7.23


Response to assessed risks: Substantive tests of accounts rec -

CS 7 6.19

Response to assessed risks: Tests of control - CS 6 6.18Results of the firms monitoring process 2.21

Review of interim and other financial info performed by the

auditor of the entity report on review of interim fin info 5.33

Reviewing client continuance and sending an engagement letter

on a continuing engagement - CS 1 6.9

Reviews of finan infor where the assurance provider is not the

auditor of the entity 5.33

Reviews of other historical financial information 5.34

Risk assessment 10.36


Risk assessment procedures

fraud triangle, ISA 240 Appendix 1 risk factors for fradulent fin reporting and

misappropriation of assets 7.12

Risk assessment procedures - perform

inquiries of mgt and others within the entity, analytical procedures, observations and

inspection 3.15 Q.9, Q17 ISA 315 P6

Risk assessment procedures and fraud risk factors CS: 9 7.19

Risk assessment procedures and mgt oversignt CS: 7 7.16

Risk assessment procedures and other infor CS:5 7.14

Risk assessment thru analytical procedures CS: 8 7.17

Risk Management assurance 10.42

Risk of fraud CS:1 7.6





Sample selection Random, systematic, haphazard 4.16 Q.5, Q4 ISA 530 APPX 4




Sampling techniques in substantive procedures Dollar unit sampling, evaluation of substantive sample results 4.28Second opinions 1.39

Service indicators - effectiveness egs 9.43

Significance - Performance audit professional judgement 9.30



Small business audits - audit approach 4.42

Small businesses - audit of SMEs, small and medium sized enterprises 4.39

Small businesses - internal controls in 4.40

Solicitor's representation letters 4.47Special purpose frameworks - audits of fin stmts prepared in

accordence tax basis, cash receipts, finan rep provision, etc 5.27

Specialised areas - audits of special considerations, ISA 800, ISA 805, ISA 810 5.27

Specific elements - audits of single financial stmts and specific

elements, accounts or items of a fin stmt 5.28

Strategic analysis


environment 3.35

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chain analysis 3.37

Strategic risks 3.36


Structure of IAASB pronouncements Figure 1.1 1.6

Subject matterfive categories - Fin perfomance, Non-fin performance, Physical Characteristics,Systems and Processes and Behaviour 1.13

Subsequent events auditors responsibilites, applicable audit procedures, specific procedures, 4.44 Q.15

Substantive audit procedures 4.16


Sufficiency - performance audit 9.12


Sufficient appropriate audit evidence

key principles: sufficiency relates to qty of audit evidence, appropriateness -

relevance and reliability of audit evidence 4.5

Sufficient appropriate evidence

Professional scepticism, sufficience and approp of evidence, materiality, ass eng'mt

risk and nature, timing and extent of evidence gathering procedures 1.16


Summary financial statments 5.29 Q.14

Survey of assurance services being provided 10.7 Q.6

Sustainability assurance subject matter, criteria, key per ind, evidence gathering, reporting on conculsion 10.25

Sustainability assurance - Frameworks for 10.18

Sustainability assurance - new developments Assurance on carbon emmission dis, ass on water accts reports 10.23Sustainability assurance - recent surveys of insights and inadequacies 10.22

Sustainability report 10.14

Sustainability reporting - assurance on Phase I, Phase II, 10.20

AA1000 - Assurance

Std (AA1000AS)


System based review Performance audit 9.31

System software controls 3.24

Systems and Processes - assurance on 10.32

Systems development and program maintenance controls 3.23






Tests of account balances - types external confirmations, bank confirmations, attendance at physical inventory counts 4.22 Q.3, Q.7 ISA 505 P 15 A23


Tests of control



period of reliance 4.8

Tests of control procedures 4.9

Tests of details nature of tests, tests of transactions and account balances 4.21

The auditors responsibility if fraud is detected CS:14 7.26



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Triple bottom line reporting - CPA Aus Inquiry, Observation, Inspection, Computation, Confirmation, Anal procedures 10.17 Q.8

Types of auditor's reports 5.10

Types of indicators - performance Inputs, outputs, outcomes, resources 9.40 Q.4


understanding performance audits 9.10Unmodified auditors report example 5.11

Unusual and unexpected relationships - consideration Going concern - audit software commonly used to evaluate GCA 8.13 Q.4, Q.5

Unusual and unexpected relationships - evaluations of 7.17

Using audit software to analyse the A/R master file CS 8 6.19

Utility programs and systems mgt programs Adjs and dis-adjs of utility and systems mgt prgs 4.26 Q.14




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Description Detail Description

Page

No Qs Ruling

MODULE 1 -ASSURANCES SERVICES FRAMEWORK

Internal Auditing and Ass Stds Board (IAASB) ISSAB, ISSAB(2009b), ISAs 1.5, 1.8

Structure of IAASB pronouncements Figure 1.1 1.6



Assurance engagements other than audits or reviews of historial

fin infor Prospective fin info, non-fin per indi, systems or processes and behaviour 1.7

Related services



Preamble to Australian auditing stds 1.8

Assurance engagements - Types Reasonable versus, Limited, differences 1.10 Q.3, Q.5 ISRE 2410, IFAE P11





Subject matter

five categories - Fin perfomance, Non-fin performance, Physical Characteristics,

Systems and Processes and Behaviour 1.13


Sufficient appropriate evidenceProfessional scepticism, sufficience and approp of evidence, materiality, ass eng'mtrisk and nature, timing and extent of evidence gathering procedures 1.16



Materiality




Inherent risk 1.18

Control risk 1.18

Detection risk 1.18

Nature, timing and extent of evidence gathering procedurestwo factors - reasonable ass will be less than obsolute ass, nature , timing and extendof evidence gathering in altd ass eng'ment 1.19 Q.10



Audit judgement




Establishing criteria 1.24











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Code of Ethics for Professional Accts - the conceptual framework

approach


behaviour 1.34





behaviour 1.36 Q.14Integrity 1.36

Objectivity 1.36








Conflicts between two or more clients 1.39Second opinions 1.39






Independence 1.40



approach to 1.42







Ethical requirements - relevant - QC 1.46


- QC 1.47





Monitoring - QC

risk reviews, compliance reviews, fin stmt desktop reiew, quality reviews - eng level,

practice unit, global operation risk mgt review, global indpendence review 1.50 Q.11 ISQC 1






MODULE 2 - GENERAL AUDIT PRINCIPLES AND AUDITOR RESPONSIBILITIES



Q.3,

Q.1,Q.5

ISA 200 P 17, P32, O

- P45-47


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ISA 210.10, - P 15, A

33

Engagement Letter 2.10 Q.10Audit independence for the audit of fin'l stmts conflict of interst situation 2.14

Non-audit services 2.14




Engagement team members compliance with enthical

requirments 2.18


- 2.19



Results of the firms monitoring process 2.21







Q.22,Q.2(M

7) ISA 240 P 11 A4-5, -



Misappropriation of assets theft - examples 2.27 Q.13




Fraud risk factors - consideration of factors, nature of fraud and fraud indicators 2.30

Fraud Triangle incentive, opportunity, rationalise 2.31 Q.12 ISA 240 P 11 A4-A5









Communication of audit matters with those charged with

governance fraud 2.39 Q.14 ISA 260 P A1-A4




MODULE 3 -UNDERSTANDING THE ENTITY, ASSESSING RISK AND RESPONDING TO RISKSAudit Planning of financial statements nature and extent of plg, audit plg activities and procedures 3.5


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Materiality concepts>= 10% of base amt is material,

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Strategic analysis


environment 3.35

Business risks 3.36 Q.2 ISA 315 P 4 A30Strategic risks 3.36



chain analysis 3.37

Business models



and customers 3.38



Porters five forces5 forces: Threat to new entrants, power of suppliers, intensity of industry rivalry,power of buyers and power of substitutes 3.42
















MODULE 4 - THE AUDITOR'S RESPONSE TO ASSESSED RISKS

Sufficient appropriate audit evidencekey principles: sufficiency relates to qty of audit evidence, appropriateness -relevance and reliability of audit evidence 4.5



Audit procedures



Tests of control



period of reliance 4.8

Tests of control procedures 4.9







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Sample selection Random, systematic, haphazard 4.16 Q.5,

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