5.5 - Requirements in Relation to Fraud Flashcards
1
Q
What is an auditor’s first line of defence against fraud?
A
Professional scepticism
2
Q
What is professional scepticism a balance of?
A
A balance between scepticism and trust
3
Q
What must the discussion that takes place amongst the engagement team about fraud include?
A
An exchange of ideas
4
Q
What is the purpose of an ‘exchange of ideas’?
A
To bear the knowledge and experience of the engagement team on this issue
5
Q
What must the auditor’s audit risk assessment take into account?
A
Must take into account the risk of material misstatements due to fraud, and the audit plan must include responses to these risks
6
Q
What three things are needed to identify risks in general?
A
- inquiry
- analytical procedures (Fluctuations from expected results)
- investigation and observation
