Audit and Assurance (ACT 541)

1. Describe audit and assurance engagements and elements of an assurance engagement
2. Discuss the concepts of accountability, stewardship and agency.

Corporate Governance

1. Discuss the objectives, relevance and importance of corporate governance.
2. Analyse the structure and roles of audit committees and discuss their benefits and limitations.

Class Activity using Google Classroom and/or Kahoot!

1. Describe the regulatory environment within which external audits take place.
2. Discuss the reasons and mechanisms for the regulation of auditors.

3. Explain the statutory regulations governing the appointment, rights, removal and resignation of auditors.
4. Describe the limitations of external audits.

1. Define and apply the fundamental principles of professional ethics of integrity, objectivity, professional competence and due care, confidentiality and professional behavior.
2. Define and apply the conceptual framework, including the threats to the fundamental principles of self-interest, self-review, advocacy, familiarity, and intimidation.

3. Discuss the safeguards to offset the threats to the fundamental principles.
4. Describe the auditor’s responsibility with regard to auditor independence, conflicts of interest and confidentiality.

1. Discuss the requirements of professional ethics and ISAs in relation to the acceptance / continuance of audit engagements.
2. Explain the overall objectives and importance of quality control procedures in conducting an audit.

Objective and general principles

1. Identify the overall objectives of the auditor and the need to conduct an audit in accordance with ISAs.
2. Explain the need to plan and perform audit engagements with an attitude of professional skepticism, and to exercise professional judgment.

Class Activity using Google Classroom and/or Kahoot!

1. Describe the audit risks in the financial statements and explain the auditor’s response to each risk.
2. Define and explain the concepts of materiality and performance materiality.

Understanding the entity, its environment and the applicable financial reporting framework

1. Explain how auditors obtain an initial understanding of the entity, its environment and the applicable financial reporting framework.
2. Describe and explain the nature and purpose of analytical procedures in planning.

Fraud, laws and regulations

1. Discuss the effect of fraud and misstatements on the audit strategy and extent of audit work.
2. Discuss the responsibilities of internal and external auditors for the prevention and detection of fraud and error.

Class Activity using Google Classroom and/or Kahoot!

Quiz on Audit Risks

Homework on Audit Risks using exam-type questions (Constructive Response format) – Google Form via Google Classroom

Technical Paper on Audit Risks

Controlled Case Study no. 1 – Audit Planning and Audit Risks

1. Identify and describe the contents of the overall audit strategy and audit plan.
2. Explain and describe the relationship between the overall audit strategy and the audit plan.
3. Explain the need for, and the importance of, audit documentation.

Class Activity using Google Classroom and/or Kahoot!

1. Explain why an auditor needs to obtain an understanding of the components of internal control relevant to the preparation of the financial statements.
2. Describe and explain the five components of a system of internal control.

The use and evaluation of systems of internal control by auditors

1. Explain how auditors record systems of internal control including the use of narrative notes, flowcharts and questionnaires.
2. Discuss the limitations of internal control components.

Internal audit and governance, and the differences between external audit and internal audit

1. Discuss the factors to be taken into account when assessing the need for internal audit.
2. Compare and contrast the role of external and internal audit.

Class Activity using Google Classroom and/or Kahoot!

Homework on Internal Controls using exam-type questions (Constructive Response format) – Google Form via Google Classroom

1. Discuss the scope of internal audit and the limitations of the internal audit function.
2. Explain outsourcing and the associated advantages and disadvantages of outsourcing the internal audit function.
3. Discuss the nature and purpose of internal audit assignments including value for money, IT, financial, regulatory compliance, fraud investigations and customer experience.
4. Discuss the nature and purpose of operational internal audit assignments.
5. Describe the format and content of internal audit review reports and make appropriate recommendations to management and those charged with governance.

Communication on internal control

1. Discuss the requirements and methods of how reporting significant deficiencies in internal control are provided to management and those charged with governance.
2. Explain, in a format suitable for inclusion in a report to management, significant deficiencies within a system of internal control and provide control recommendations for overcoming these deficiencies to management.
3. Discuss the need for auditors to communicate with those charged with governance.

Class Activity using Google Classroom and/or Kahoot!

1. Describe computer systems controls including general IT controls and information processing controls.
2. Describe control objectives, control procedures, control activities, direct controls, indirect controls and tests of controls in relation to:
   1. The sales system;
   2. The purchases system

1. Describe control objectives, control procedures, control activities, direct controls, indirect controls and tests of controls in relation to:
   1. The payroll system
   2. The inventory system

1. Describe control objectives, control procedures, control activities, direct controls, indirect controls and tests of controls in relation to:
   5. The bank and cash system
   6. Non-current assets

1. Explain the assertions contained in the financial statements about:
   1. Classes of transactions and events and related disclosures;
   2. Account balances and related disclosures at the period end.
2. Describe audit procedures to obtain audit evidence, including inspection, observation, external confirmation, recalculation, re-performance, analytical procedures and enquiry.
3. Discuss the quality and quantity of audit evidence.
4. Discuss the relevance and reliability of audit evidence.

Audit procedures

1. Discuss substantive procedures for obtaining audit evidence.
2. Discuss and provide examples of how analytical procedures are used as substantive procedures.
3. Discuss the problems associated with the audit and review of accounting estimates.
4. Describe why smaller entities may have different control environments and describe the types of evidence likely to be available in smaller entities.
5. Discuss the difference between tests of control and substantive procedures.

Audit sampling and other means of testing

1. Define audit sampling and explain the need for sampling.
2. Identify and discuss the differences between statistical and nonstatistical sampling.
3. Discuss and provide relevant examples of the application of the basic principles of statistical sampling and other selective testing procedures.
4. Discuss the results of statistical sampling, including consideration of whether additional testing is required.

Class Activity using Google Classroom and/or Kahoot!

Homework on FS Assertions and Audit Procedures using exam-type questions (Constructive Response format) – Google Form via Google Classroom

1. Receivables:
   1. direct confirmation of accounts receivable
   2. other evidence in relation to receivables and prepayments
   3. other evidence in relation to current assets and
   4. completeness and occurrence of revenue.

Class Activity using Google Classroom and/or Kahoot!

Quiz on Audit of Receivables

1. Inventory:
   1. inventory counting procedures in relation to year-end and continuous inventory systems
   2. cut-off testing
   3. auditor’s attendance at inventory counting
   4. direct confirmation of inventory held by third parties
   5. valuation and
   6. other evidence in relation to inventory.

Class Activity using Google Classroom and/or Kahoot!

Homework on Inventory using exam-type questions (Constructive Response format) – Google Form via Google Classroom

3. Payables and accruals:
   1. supplier statement reconciliations and direct confirmation of accounts payable
   2. obtain evidence in relation to payables and accruals
   3. other evidence in relation to current liabilities and
   4. purchases and other expenses, including payroll.

1. bank confirmation reports used in obtaining evidence in relation to bank and cash
2. other evidence in relation to bank and
3. other evidence in relation to cash.

1. evidence in relation to non-current assets
2. depreciation and
3. profit/loss on disposal.

The audit of Non-current liabilities, Provisions and Contingencies
Explain the audit objectives and the audit procedures to obtain sufficient, appropriate evidence in relation to:
Non-current liabilities, provisions and contingencies:

1. evidence in relation to non-current liabilities and
2. provisions and contingencies.

Class Activity using Google Classroom and/or Kahoot!

Homework on Non-Current Assets using exam-type questions (Constructive Response format) – Google Form via Google Classroom

Controlled Case Study no. 4 – Internal Controls and Audit Procedures

1. evidence in relation to share capital, reserves and directors’ emoluments.

Automated tools and techniques

1. Explain the use of automated tools and techniques in the context of an audit, including the use of audit software, testdata and other data analytics tools.
2. Discuss and provide relevant examples of the use of automated tools techniques including test data, audit software and other data analytics tools.

The work of others

1. Discuss why auditors rely on the work of others.
2. Discuss the extent to which external auditors are able to rely on the work of experts, including the work of internal audit.
3. Explain the audit considerations relating to entities using service organisations.
4. Explain the extent to which reference to the work of others can be made in the independent auditor’s report.

Not-for-profit organisations

1. Apply audit techniques to not-for-profit organisations.

Class Activity using Google Classroom and/or Kahoot!

Homework on CAATs and the work of others using exam-type questions (Constructive Response format) – Google Form via Google Classroom

1. Explain the purpose of a subsequent events review.
2. Explain the responsibilities of auditors regarding subsequent events.
3. Discuss the procedures to be undertaken in performing a subsequent events review.

Going concern

1. Define and discuss the significance of the concept of going concern.
2. Explain the importance of and the need for going concern reviews.
3. Explain the respective responsibilities of auditors and management regarding going concern.
4. Identify and explain potential indicators that an entity is not a going concern.
5. Discuss the procedures to be applied in performing going concern reviews.
6. Discuss the disclosure requirements in relation to going concern issues.
7. Discuss the reporting implications of the findings of going concern reviews.

Written representations

1. Explain the purpose of and procedure for obtaining written representations.
2. Discuss the quality and reliability of written representations as audit evidence.
3. Discuss the circumstances where written representations are necessary and the matters on which representations are commonly obtained.

Class Activity using Google Classroom and/or Kahoot!

Homework on Subsequent Events and Written Representations using exam-type questions (Constructive Response format) – Google Form via Google Classroom

1. Discuss the importance of the overall review in ensuring that sufficient, appropriate evidence has been obtained.
2. Describe procedures an auditor should perform in conducting their overall review of financial statements.

3. Explain the significance of uncorrected misstatements.
4. Evaluate the effect of dealing with uncorrected misstatements.

1. Identify and describe the basic elements contained in the independent auditor’s report.
2. Explain unmodified audit opinions in the auditor’s report.
3. Explain the circumstances in which a modified audit opinion may be issued in the auditor’s report.

4. Explain the impact on the auditor’s report when a modified opinion is issued.
5. Describe the format and content of key audit matters, emphasis of matter and other matter paragraphs.

Quiz on the Independent Auditor’s Report