T8 Notes
T8 Notes
T8 Notes
T8 Notes
T8 Notes
T8 Notes
T8 Notes
T8 Notes
T8 Notes
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T8 Notes
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T8 Notes

  1. Determine the flow of documents and extent of controls
  2. Prepare comprehensive record for evaluation of the systems.
  3. Prepare and send a report to management identifying weakness and recommending improvement.
  4. Report to member is the end product which auditors express their opinion of the accounts.
  5. To review internal financial control
  6. To review internal control and risk management systems
  7. To monitor and review the effectiveness of internal audit
  8. To make recommendation on the appointment of external auditors
  9. To approve the remuneration and terms of engagement of external auditors
  10. To review and monitor the independence and objectivity of the external auditors and the effectiveness of the audit process.
  11. To develop and implement policy on the engagement of the external auditor to supply non-audit services.
  12. Discussing among the engagement team
  13. Management’s assessment of risk
  14. Management’s identifying and responding to risk
  15. Management’s communication to governances and employee
  16. Question management if they aware of any actual, suspected or alleged fraud
  17. If there are internal auditors, external auditors should ask them if they aware of actual, suspected, or alleged fraud, obtain their view about risk of fraud, and procedures performed
  18. Make enquiries to other operating personnel not involving in governance.
  19. Obtain an understanding of how those governance oversights the processes of identifying and responding to fraud & internal control in place.
  20. Make inquiries to governance if they aware of the actual, suspected, or alleged fraud.
  21. Consider unusual or unexpected relationships
  22. Consider if other information obtained risks
  23. Detect fraud by being mindful when carry out work
  24. Provide auditors with access to all documents
  25. use general accept auditing techniques
  26. investigate if any suspicious
  27. act honestly and carefully when making judgment
  28. Duty to carry out the work required with Reasonable expediency (方便)
  29. Fit (competence and capacity) and proper (character and suitability) persons
  30. Works is conducted Properly with professional integrity
  31. Technical standards (eg. ISAs)
  32. Maintain an appropriate level of Competence (CPD)
  33. Investigation of complaints against members
  34. Compulsory professional indemnity (损害赔偿) insurance In each visit of the regulatory body to monitor the auditors should be as following:
  35. Proper structure of audit approach
  36. Carefully instituted quality control procedures
  37. Ethical guidelines
  38. Technical excellence
  39. Fit and proper criteria
  40. Peer review (audit files are review by another partner in audit firm)
  41. Hot review is carried out before report is signed by peer.
  42. Cold review is carried out after report is signed by independence person
  43. Sufficiently documented
  44. Issues resolved and reflected in audit conclusion
  45. Objectives were achieved
  46. Essential procedures
  47. Objectivity: unbiased, conflict of interest, undue influence of the others or business judgment.
  48. Professional Competence and due care: maintain professional knowledge on current development in practice, legislation, and techniques, act diligently or thoroughly and in accordance with standard.
  49. Confidentiality: respect the confidentiality of information, not disclosed information to third parties.
  50. Self-review eg. Review by the same person
  51. Advocacy
  52. Familiarity eg. long association, acceptance of gift
  53. Valuation services
  54. Taxation services
  55. Internal audit services
  56. Corporate finance services
  57. IT services
  58. Temporary staff cover
  59. Public duty
  60. Legal or professional right or duty
  61. Engagement economic
  62. Risk
  63. Relationship
  64. Auditors’ responsibilities
  65. Management’s responsibilities
  66. Finance reporting framework management adopted
  67. Form of any report to be issued by auditors
  68. Inherent limitation of an audit that some material misstatement may remain undiscovered
  69. Revise or special term of engagement
  70. Change of senior management
  71. Significant change in the nature or size in client business
  72. Legal requirements
  73. Change in the financial reporting framework
  74. Relationship with recent developments
  75. Degree of subjectivity in financial information
  76. Unusual transaction
  77. Management intervention
  78. Complex accounting principles or calculation
  79. Manual intervention
  80. Opportunity for control procedures not to be allowed
  81. Significant transaction with a related party
  82. Emphasizing to audit staff to maintain professional skepticism
  83. Assigning additional or more experienced staff to the audit team
  84. Using experts
  85. Providing more supervision
  86. Incorporating more unpredictability into the audit procedures
  87. Detailed further audit procedure
  88. Tests of controls to obtain sufficient and appropriateness audit evidence
  89. Reperformance and inspection are useful procedure
  90. Substantive procedures (on material items)
  91. Analytical procedures
  92. Large volumes of predictable transactions
  93. Other procedures (tests of detail)
  94. Class of transactions, account balance and disclosure
  95. Agreeing FS to the underlying accounting records
  96. Examining material journal entries
  97. Examining other adjustments made in preparing the financial statements
  98. Assess the risks of material misstatements
  99. Limitation of accounting system and internal control (accounting record may not full of detail and accounting system may be operated by person who do not full understand of system)
  100. There is collusion which directors and staffs do not tell the true
  101. Audit evidence just indicate a probable not a certain.
  102. Materiality
  103. Past experience
  104. Errors mean breach the statutory requirements
  105. Critical point errors (loss in profit)
  106. Actuarial calculation of liabilities associated with insurance contracts or employee benefit plan, environment liabilities, clean-up costs, contracts, laws and regulations
  107. Discussion with that expert
  108. Discussion with other auditors expert familiar with
  109. Knowledge of qualifications, membership of professional body or industry association, license to practice, or other form of external recognition
  110. Published papers or book written by that expert
  111. The roles and responsibilities of auditor and expert
  112. The nature, timing and extent of communication between auditors and expert
  113. Assumption and method used
  114. When work is carried out
  115. The reason for any changes in assumption and method
  116. Examine the financial & operational information
  117. Review of economy, effectiveness, and efficiency
  118. Review of compliance with laws and regulations
  119. Technical competence – technical training
  120. Professional due care – properly planned, supervised, reviewed and documented
  121. Auditing through computer: examine the detail processing routine of control in the system if adequate, and this should use Computer Assisted Audit Technique (CAAT)
  122. Comparison programs – compare program’s version
  123. Interactive software – online system’s information
  124. Controls are less effective than they actually are or test of details that a material error exists when it does not – this is risk of Audit efficiency.
  125. They provide as reference for audit problems encountered.
  126. They are invaluable in the event of litigation against them by either the client or some third party.
  127. They are not only assisting in the control of current audit but well for planning and control of future audit.
  128. The results of the audit procedures performed, and the audit evidence obtained;
  129. It will be neater and easier to review
  130. Save time, computer will summarize the key analytical information
  131. Standard form can be called up on the screen
  132. They promptly recorded at the correct amount, correct account, and proper accounting period.
  133. Access to assets is proper authorized
  134. Recorded assets are compared with the existing assets.