EAC 4412 Advanced Auditing

Lecture: Course Welcome

Lecture: Course Introduction

Outcomes

Lecture: The Role of the Auditor

Outcomes

After completing this lecture students will be able to:

• Distinguish between auditor and management responsibilities
• Explain the importance of auditor independence
• Review GAAS

Lecture: Workpaper Technique

Outcomes

After completing this lecture students will be able to:

• Describe basic workpaper technique
  • Describe the file organization
  • Describe the types of workpapers
  • Describe the workpaper formatting

Lecture: Auditing Cash

Outcomes

After completing this lecture students will be able to:

• Explain the risk assessment procedures related to auditing cash
• Discuss the financial statement assertions and audit objectives for cash
• Describe substantive audit procedures in general
• Describe substantive audit procedures for cash
• Explain the practical cash audit considerations

Lecture: Auditing Cash

Outcomes

After completing this lecture students will be able to:

• Explain the risk assessment procedures related to auditing cash
• Discuss the financial statement assertions and audit objectives for cash
• Describe substantive audit procedures in general
• Describe substantive audit procedures for cash
• Explain the practical cash audit considerations

Lecture: Auditor Independence: Practical Consideration

Outcomes

After completing this lecture students will be able to:

• Explain the importance of auditor independence and apply it into a practical situation

Lecture: Audit Documentation

Outcomes

After completing this lecture students will be able to:

• Explain the conceptual transition from audit working papers to audit documentation
• Explain the audit documentation objectives in general
• Describe audit findings/issues documentation requirements
• Describe documentation retention requirements
• Identify other factors impacting audit documentation requirements

Lecture: Audit Programs

Outcomes

After completing this lecture students will be able to:

• Explain the purposes of audit programs
• Explain the purposes of planning and control
• Promote audit efficiency and effectiveness
• Demonstrate compliance with professional standards
• Create/edit an audit program

Lecture: Auditing Accounts Receivable 

Outcomes

After completing this lecture students will be able to: 

• Explain and practice auditing accounts receivable (A/R)
• Explain risk assessment procedures related to auditing A/R
• Explain financial statement assertions and audit objectives for A/R
• Describe substantive A/R audit procedures in general
• Describe substantive A/R audit procedures for confirmations
• Identify the practical A/R audit considerations 

Lecture: Audit Confirmations

Outcomes

After completing this lecture students will be able to:

• Consider audit testing in general
• Consider audit confirmations specifically
  • Why confirm
  • Types of confirmations
  • Timing
  • Management restrictions
  • Alternative procedures for nonresponders

Lecture: Auditing Inventory

Outcomes

After completing this lecture students will be able to:

• Explain and practice auditing inventory
• Explain risk assessment procedures related to inventory
• Explain the financial statement assertions and audit objectives for inventory
• Describe audit procedures and inventory observation
• Describe audit procedures and inventory valuation
• Explain sampling when auditing inventory
• Identify practical inventory audit considerations

Lecture: Audit Risk and Materiality

Outcomes

After completing this lecture students will be able to:

• Describe audit-related risk in general
• Explain financial statement materiality
• Discuss when to consider risk and materiality
• Explain audit response to risk
• Explain risk assessment techniques
• Explain inherent and control risk
• Describe how to evaluate audit findings
• Describe the effect of misstatements on the auditor’s report

Lecture: Auditing Accounting Estimates

Outcomes

After completing this lecture students will be able to:

• Explain the accounting estimates in general
• Describe the estimation process
• Explain how to evaluate accounting estimates
• Explain how to audit accounting estimates

Lecture: Auditing Property, Plant, and Equipment

Outcomes

After completing this lecture students will be able to:

• Explain and practice auditing property, plant, and equipment (PP&E)
• Explain risk Assessment procedures for PP&E
• Discuss the financial statement assertions and audit objectives for PP&E
• Describe substantive PP&E audit procedures
• Discuss the practical PP&E audit considerations 

Lecture: Internal Control: General

Outcomes

After completing this lecture students will be able to:

• Define internal control
• Explain the components of internal control:
  • Control environment
  • Risk assessment
  • Information and communication system
  • Control activities
  • Monitoring
• Explain the consideration of internal control
• Describe techniques used to obtain internal control understanding

Describe the auditor’s internal control communication responsibility

Lecture: Internal Control: Practical Consideration

Outcomes

After completing this lecture students will be able to:

• Describe the importance of the private accountant ethics
• Describe the internal control in a practical situation

Lecture: Auditing Accounts Payable and Accrued Liabilities

Outcomes

After completing this lecture students will be able to:

• Explain and practice auditing accounts payable and accrued liabilities
• Explain risk assessment procedures for accounts payable and accrued liabilities
• Explain the financial statement assertions and audit objectives for accounts payable and accrued liabilities
• Describe accounts payable audit procedures, general
• Describe accounts payable audit procedures, confirmation
• Explain accrued liability audit procedures
• Describe practical accounts payable and accrued liability audit considerations

Lecture: Auditing Accounts Payable: CBI Holding Company, Inc.

Outcomes

After completing this lecture students will be able to:

• Discuss a classic audit failure – CBI Holding Company, Inc.

Lecture: Management's Representations

Outcomes

After completing this lecture students will be able to:

• Explain the management representations in general
• Explain the need for written representations
• Identify typical management representations
• Discuss the consequences if management refuses to furnish written representations

Lecture: Auditing Notes Payable

Outcomes

After completing this lecture students will be able to:

• Explain and practice auditing notes payable
• Explain risk assessment in auditing notes payable
• Discuss the financial statement assertions and audit objectives for notes payable
• Describe substantive notes payable audit procedures
• Describe the practical notes payable audit considerations

Lecture: Audit Team Roles and Conflict

Outcomes

After completing this lecture students will be able to:

• Explain the in-charge accountant's role in the audit team
• Discuss the conflicts that may arise among audit team members
• Identify audit team conflict resolution techniques

Lecture: Reporting

Outcomes

After completing this lecture students will be able to:

• Describe the standard audit report for nonpublic company audits
• Describe the standard audit report for public company audits
• Explain the circumstances that result in the addition of  explanatory language to the auditor’s standard report
• Identify the circumstances that may result in a qualified opinion, adverse, or disclaimer of opinion
• Explain the auditor’s reporting on comparative financial statements

Lecture: Auditing the Income Statement and Completing the Audit 

Outcomes

After completing this lecture students will be able to:

• Explain auditing the income statement
• Explain audit completion procedures in general
• Describe the legal letter
• Describe the client letter of representations
• Discuss evaluating commitments, contingencies, and subsequent events
• Identify the final audit completion steps

Lecture: Enron

Outcomes

After completing this lecture students will be able to:

• Explain a major recent audit failure that led to the ruin of a major auditing firm
• Explore the audit risks associated with aggressive accounting practices
• Identify the factors that contributed to the Enron collapse