The document discusses various topics related to assurance engagements and auditing:
1. It defines two levels of assurance engagements - reasonable assurance and limited assurance. Reasonable assurance requires more evidence and a positive report while limited assurance requires less evidence and a negative report.
2. It outlines the key elements of an assurance engagement including the three party relationship between the user, responsible party, and practitioner. It also discusses the subject matter, suitable criteria, evidence, and written report.
3. It explains the importance of independence for auditors. Independence requires being free from bias, conflicts of interest, and undue influence in order to maintain objectivity and issue an unbiased opinion. Safeguards like removing individuals from
Audit Evidence is one of the International Standards on Auditing. -It serves to expect the auditor to obtain audit evidence from an appropriate mix of tests of control systems and substantive tests of transaction and balances.
Audit Evidence is one of the International Standards on Auditing. -It serves to expect the auditor to obtain audit evidence from an appropriate mix of tests of control systems and substantive tests of transaction and balances.
An internal audit is designed to review what a company is doing in order to identify potential threats to the organization's financial health and profitability and to make suggestions for mitigating the risk associated with those threats.
Internal Audit is a tool of control to measure and evaluate the effectiveness of the working of an organization primarily with accounting, financial and operational matters.
Internal Audit plays a constructive role by rendering service to the management with objective appraisal of systems, procedures, practices, compliance with policies.
LetzConsult presents a smarter ways for companies to find the most relevant Consultant for their business needs. Find the right consultants for your Company on LetzConsult.com
This is a step-by-step process on how to plan and carry out Auditing. This shall be useful for Accountants , professionals,small businesses,big businesses.
An exercise whose objective is to enable auditors to express an opinion on whether the financial statements give a true and fair view (or equivalent) of the entity’s affairs at the period end and of its profit or loss (or income and expenditure) for the period then ended and have been properly prepared in
accordance with the applicable reporting framework (e.g. relevant legislation and applicable accounting standards) or where statutory or other specific requirements prescribe the term, whether the financial statements “present fairly”.
An internal audit is designed to review what a company is doing in order to identify potential threats to the organization's financial health and profitability and to make suggestions for mitigating the risk associated with those threats.
Internal Audit is a tool of control to measure and evaluate the effectiveness of the working of an organization primarily with accounting, financial and operational matters.
Internal Audit plays a constructive role by rendering service to the management with objective appraisal of systems, procedures, practices, compliance with policies.
LetzConsult presents a smarter ways for companies to find the most relevant Consultant for their business needs. Find the right consultants for your Company on LetzConsult.com
This is a step-by-step process on how to plan and carry out Auditing. This shall be useful for Accountants , professionals,small businesses,big businesses.
An exercise whose objective is to enable auditors to express an opinion on whether the financial statements give a true and fair view (or equivalent) of the entity’s affairs at the period end and of its profit or loss (or income and expenditure) for the period then ended and have been properly prepared in
accordance with the applicable reporting framework (e.g. relevant legislation and applicable accounting standards) or where statutory or other specific requirements prescribe the term, whether the financial statements “present fairly”.
Audit company - Audit for companies - PKC Management ConsultingPKCIndia2
An audit company is usually hired to perform the audit process. The auditor will work closely with the company's finance team to review financial statements, internal controls, and other relevant documents. we will provide an overview of how audits work, including the different stages and levels involved in the process. Whether you are a business owner or a professional looking to learn more about auditing practices, this article will serve as a useful guide. In conclusion, PKC Management Consulting is a reputable audit company that offers comprehensive and efficient auditing services for companies of all sizes. With their team of experienced auditors and consultants, they provide valuable insights and recommendations to improve business operations and financial management. Their commitment to integrity, professionalism, and customer satisfaction sets them apart in the industry. If you're looking for an audit partner that can help you achieve your business goals, PKC Management Consulting is the right choice. Contact them today to learn more about their services and how they can add value to your organization.
What is the Financial Statement Audit Process.pdfsarikabangimatam
A financial statement audit is a review of your financials and related documents by a third-party auditor. This review report is intended to add credibility to our reported financial health and Business Accountants performance. But what happens in this study? Does your business need an audit? We answer all your questions below.
Client Evaluation and Planning the Audit Lecture slide chapter 8
Describe the steps involved in client acceptance and continuance.
State the purpose and content of an engagement letter.
Explain the steps in planning an audit.
Identify the risks of misstatement through understanding the entity and its environment.
Explain the role of analytical procedures in audit planning.
Describe the requirements to consider the risk of fraud in the audit planning process.
Explain the purpose and function of audit working papers.
How to Create Map Views in the Odoo 17 ERPCeline George
The map views are useful for providing a geographical representation of data. They allow users to visualize and analyze the data in a more intuitive manner.
We all have good and bad thoughts from time to time and situation to situation. We are bombarded daily with spiraling thoughts(both negative and positive) creating all-consuming feel , making us difficult to manage with associated suffering. Good thoughts are like our Mob Signal (Positive thought) amidst noise(negative thought) in the atmosphere. Negative thoughts like noise outweigh positive thoughts. These thoughts often create unwanted confusion, trouble, stress and frustration in our mind as well as chaos in our physical world. Negative thoughts are also known as “distorted thinking”.
Palestine last event orientationfvgnh .pptxRaedMohamed3
An EFL lesson about the current events in Palestine. It is intended to be for intermediate students who wish to increase their listening skills through a short lesson in power point.
This is a presentation by Dada Robert in a Your Skill Boost masterclass organised by the Excellence Foundation for South Sudan (EFSS) on Saturday, the 25th and Sunday, the 26th of May 2024.
He discussed the concept of quality improvement, emphasizing its applicability to various aspects of life, including personal, project, and program improvements. He defined quality as doing the right thing at the right time in the right way to achieve the best possible results and discussed the concept of the "gap" between what we know and what we do, and how this gap represents the areas we need to improve. He explained the scientific approach to quality improvement, which involves systematic performance analysis, testing and learning, and implementing change ideas. He also highlighted the importance of client focus and a team approach to quality improvement.
The Roman Empire A Historical Colossus.pdfkaushalkr1407
The Roman Empire, a vast and enduring power, stands as one of history's most remarkable civilizations, leaving an indelible imprint on the world. It emerged from the Roman Republic, transitioning into an imperial powerhouse under the leadership of Augustus Caesar in 27 BCE. This transformation marked the beginning of an era defined by unprecedented territorial expansion, architectural marvels, and profound cultural influence.
The empire's roots lie in the city of Rome, founded, according to legend, by Romulus in 753 BCE. Over centuries, Rome evolved from a small settlement to a formidable republic, characterized by a complex political system with elected officials and checks on power. However, internal strife, class conflicts, and military ambitions paved the way for the end of the Republic. Julius Caesar’s dictatorship and subsequent assassination in 44 BCE created a power vacuum, leading to a civil war. Octavian, later Augustus, emerged victorious, heralding the Roman Empire’s birth.
Under Augustus, the empire experienced the Pax Romana, a 200-year period of relative peace and stability. Augustus reformed the military, established efficient administrative systems, and initiated grand construction projects. The empire's borders expanded, encompassing territories from Britain to Egypt and from Spain to the Euphrates. Roman legions, renowned for their discipline and engineering prowess, secured and maintained these vast territories, building roads, fortifications, and cities that facilitated control and integration.
The Roman Empire’s society was hierarchical, with a rigid class system. At the top were the patricians, wealthy elites who held significant political power. Below them were the plebeians, free citizens with limited political influence, and the vast numbers of slaves who formed the backbone of the economy. The family unit was central, governed by the paterfamilias, the male head who held absolute authority.
Culturally, the Romans were eclectic, absorbing and adapting elements from the civilizations they encountered, particularly the Greeks. Roman art, literature, and philosophy reflected this synthesis, creating a rich cultural tapestry. Latin, the Roman language, became the lingua franca of the Western world, influencing numerous modern languages.
Roman architecture and engineering achievements were monumental. They perfected the arch, vault, and dome, constructing enduring structures like the Colosseum, Pantheon, and aqueducts. These engineering marvels not only showcased Roman ingenuity but also served practical purposes, from public entertainment to water supply.
2. Amin Siddiki FCA
1. a
Level of Assurance
Reasonable
Assurance
Engagement
Under this type sufficient &
appropriate evidence are collected
and report is given in positive form
Limited Assurance
Engagement
Under this type sufficient &
appropriate evidence are collected
but relatively lower level and report
is given in negative form
International Framework for Assurance Engagement has
identified two level of assurance as follows.
3. Amin Siddiki FCA
1. b
The key elements of an assurance engagement
Three Party Relationship
• Mr. Rahim(users)
• the responsible party- Directors of Bengal group
• The audit firm (the practitioner)
A subject matter
• The most recent financial statements
Suitable Criteria
• Law and accounting standards
Sufficient Appropriate Evidence to Support the Assurance
Opinion
• Audit evidence gathered by professional accountant to
support the opinion
A Written Report
• An assurance report issued in a prescribed form.
4. Amin Siddiki FCA
1.C
Subsidiary benefits
Additional Confidence: It may give additional confidence to other parties in a
way that benefits to the business.
Reduce risk: The existence of an independent check might help prevent errors
or frauds being made and reduce the risk of management bias. Therefore, it can
be seen that an assurance service may act as a deterrent.
Users Attention :Where problems exist within information, the existence of an
assurance report draws attention to the deficiencies in that information, so that
users know what those deficiencies are.
Quality of Information: Assurance helps to ensure that high quality, reliable
information exists, leading to effective markets that investors have faith in and
trust.
5. Amin Siddiki FCA
1.D
• Consider whether disqualified on legal or ethical grounds,
for example, if there would be a conflict of interest with
another client
Ensure professionally qualified to act
• Consider available time, staff and technical expertise
Ensure existing resources adequate
• Make independent enquiries if directors are not personally
known.
Obtain references
• Enquire whether there are reasons/circumstances behind the
change which the new auditors ought to know, also as a
matter of courtesy
Communicate with present auditors
Before accepting engagement auditor must carry out following procedures
6. Amin Siddiki FCA
2.A
What is this It is a process
Designed &
effected by
Those Charged
with governance
Management Other personnel
Works for
To provide
reasonable
assurance
On
Reliability on
financial
reporting
Effectiveness and
efficiency of
operation
Compliance with
applicable laws &
regulations
Definition of Internal Control
7. Amin Siddiki FCA
2.A
Ultimate Objectives of Internal Controls
The objectives for internal control can be seen in the example.
They includes:
Minimising the company’s business risk
Ensuring the continuing effective function of the company
Ensuring the company complies with relevant laws and
regulations
8. Amin Siddiki FCA
2.B
Control Environment
Control Environment is the set of standards, processes, and structures that
provide the basis for carrying out internal control across the organization. The
board of directors and senior management establish the tone at the top
regarding the importance of internal control including expected standards of
conduct.
Audit Committee
A sub section of board of directors which has a particular interest in the
finance and accounting activities of the company
Risk Assessment Process
The Process by which management in a business identifies business risk
relevant to financial reporting objectives & decides what actions to take to
address those risk.
i. Identify relevant business risk
ii. Estimate the impact of risks
iii. Assessment the likelihood of occurrence
iv. Decide upon action to mange
9. Amin Siddiki FCA
2.C
Function of Audit Committee
Review the integrity of financial statements
Formal announcements of company performance
Review the internal financial control & risk assessment system
Monitor & review the effectiveness of internal audit function
Recommendation to the board in relation to the external auditor
Monitor the independence of the external auditor
Implement policy of non audit service by the external auditor
10. Amin Siddiki FCA
2.C
Denominator Internal Audit External Audit
Objective It is an activity designed to
add value and improve an
organisation’s operation
To express an independent
opinion on Financial
Statements
Appointed by Management Shareholders
Responsible
to
Management Shareholders
Relating to Whole operation of the
organisation both financial
and non financial
Concern to the Financial
Statement and related
information
Who they are Usually employee Independent Firm
Difference between Internal and External Audit
11. Amin Siddiki FCA
How to obtain Audit Evidence
Inspection
of Tangible
Assets
Physical verification of assets but not
confirmation of rights and obligation
Inspection
of
Documents
Examination of records or documents like:
share certificates, valuation , lease agreement
etc
Observation Watching the procedure whether correctly
performed or not.
Inquiry Seeking information from
management/staff/external sources etc
3.A
12. Amin Siddiki FCA
How to obtain Audit Evidence
Confirmmation Seeking confirmation from third party ie:
receivable, bank balance
Recalculation Checking mathematical accuracy of subject
matter
Reperformance Independently executing procedures or
control either manually or CAAT
Analytical
procedures
Evaluating and comparing data
3.A
13. Amin Siddiki FCA
Sl Assertion What to do
01. Rights &
Obligation
Vouching the document to ensure ownership
02. Existence a. Select the asset in the asset register
b. Physical Verification.
3.B.i
Addition of Non Current Assets
14. Amin Siddiki FCA
Sl Assertion What to do
03. Completeness a. Obtain a non current asset schedule
b. Confirm the addition are correct
04. Valuation a. Confirm the valuation as suggested by IAS
i. Cost of purchase through purchase invoice
ii. Directly attributable cost to capitalize
iii. Valuation certificate
b. Depreciation has been correctly calculated
05 Presentation
& Disclosure
a. Ensure disclosure criteria has been meet
Addition of Non Current Assets
3.B.i
15. Amin Siddiki FCA
3.B.ii
Sl Assertion What to do
01. Rights &
Obligation
a. Review sales invoice for sold assets to ensure that
ownership has been transferred
02. Existence a. Select the asset in the asset register
b. Physical Verification.
Disposal of Non Current Assets
16. Amin Siddiki FCA
3.B.ii
Sl Assertion What to do
03. Completeness a. Confirm sold assets are deleted from register
04. Valuation a. Depreciation has not been charged against sold asset
b. Recalculate the profit/loss against sales of asset
05 Presentation
& Disclosure
a. Ensure disclosure criteria has been meet
Disposal of Non Current Assets
17. Amin Siddiki FCA
3.C
Authorisation Approval & Control of
document
Transactions must be approved
by appropriate person
Performance
Review
Reconciliation Difference between two figures
should be reconciled
Information
Processing
Checking arithmetical
accuracy
Ex. Manual calculation of certain
items
Physical Control Physical counting of
inventory
Ex. Physical verification of petty
cash counting
Segregation of
duty
More person involve
in one accounting
process
Receivable collectors are not
allowed to post to receivable
books
Control Activities
18. Amin Siddiki FCA
3.D
Documentation
Documentation means the material (working papers) prepared by and
for, or obtained and retained by the auditor in connection with the
performance of the audit. Working papers may be in the form of data
stored in paper, film, electronic media or other media.
19. Amin Siddiki FCA
Purposes of Keeping documentation or working papers
Particularly in relation to audit, assurance providers record their work to:
a. Assist the audit team to plan and perform the audit.
b. Assist the relevant members of the team to direct supervise work.
c. Enable the audit team to be accountable for its work (and to prove
adherence to BSAs in a litigious situation). and
d. Retain a record of matters of continuing significance to future audits.
e. Enable an experienced auditor to carry out quality control reviews.
f. Enable an experienced auditor to conduct external inspections in
accordance with applicable legal, regulatory or other requirements.
3.D
20. Amin Siddiki FCA
4.A
Purpose of an Engagement Letter
The purpose of an engagement letter is to:
1. Define clearly the extent of the firm’s responsibilities
and so minimize the possibility of any
misunderstanding between the client and the firm.
2. Provide written confirmation of the firm’s acceptance
of the appointment, the scope of the engagement and the
form of their report.
21. Amin Siddiki FCA
4.A
Form & Content of an Audit Engagement Letter
The form and content audit engagement letters may vary for each
client, but they would generally include reference to the following:
1. The objective of the audit of financial statements.
2. Management’s responsibility for the financial statements.
3. The scope of the audit, including reference to applicable legislation,
regulations or pronouncements of ICAB to whom the auditor
adheres.
4. The form of any reports or other communication of results of the
engagement.
22. Amin Siddiki FCA
4.A
5. The fact that because of the test nature and other inherent
limitations of an audit, together with the inherent limitations of
any accounting and internal control systems, there is an
unavoidable risk that even some material misstatements may
remain undiscovered.
6. Unrestricted access to whatever records, documentation and
other information is requested in connection with the audit.
7. The agreement of management to make available to the auditor
draft financial statements and any accompanying other
information in time to allow the auditor to complete the audit in
accordance with the proposed timetable.
Form & Content of an Audit Engagement Letter
23. Amin Siddiki FCA
4.D
Effects on Audit Report
i. Matters fully disclosed in the Financial Statements
An unqualified report with an emphasis of matter paragraph
on going concern uncertainty highlighting the existence of
material uncertainty relating to the events or condition that
may cast significant doubt about the entities ability to continue
as a going concern and draw attention to the notes to the
financial statements that disclose the matters where
management plans to deal with events are explained.
24. Amin Siddiki FCA
4.D
Effects on Audit Report
i. Matters not disclosed in the Financial Statements
If considered material but not pervasive---qualified opinion
If considered material and pervasive ---Adverse opinion
25. Amin Siddiki FCA
5.A
Independence and objectivity are matter so much for following
reasons:
1. External auditors have a responsibility to consider the public
interest and maintain the reputation of the profession.
2. The auditor should be independent from the client company, so
that the audit opinion will not be influenced by any relationship
between them.
3. The auditors are expected to give an unbiased and honest
professional opinion on the financial statements to the
shareholders.
26. Amin Siddiki FCA
5.A
To maintain the objectivity an auditor should remain
free from
1. Biasness
2. Conflict of interest
3. Undue influence
To override professional or business judgments.
27. Amin Siddiki FCA
5.B
Independence of mind
The state of mind that permits the expression of a conclusion without being
affected by influences that compromise professional judgment, allowing an
individual to act with integrity, and exercise objectivity and professional
skepticism.
Independence in fact
Independence in fact exists when the auditor is actually able to maintain unbiased
attitude throughout the audit
Independence in appearance
The avoidance of facts and circumstances that are so significant that a reasonable
and informed third party, having knowledge of all relevant information.
28. Amin Siddiki FCA
5.C
The following safeguards will therefore be relevant but not limited to
Disposing the interest
Removing the individual form the team
Inform the audit committee of the situation
Using an independent partner to review work carried out.
29. Amin Siddiki FCA
5.D
A professional accountant even in business has a continuing duty to maintain
professional ethics as like professional in practices including integrity, objectivity
and others to ensure that employer receives competent professional service based
on current developments in practices, legislation and techniques.
Often accountants in business find themselves in dilemma when they are guided by
management as to the treatment of certain accounting transaction or presentation
in the interest of management rather public interest.
Example of probable unethical act may
1. Misleading auditors
2. Issue or to be associated with public reports that materially represent the fact.