A3 Risk, Evidence, and Sampling Flashcards
Audit Data Analytics applied at the conclusion of the audit allows for an overall _________ to gain ___________ that no material misstatement was unidentified and provides a _______ knowledge of the entity being audited, and may _____ tests done during risk assessment process.
- conclusion
- comfort
- deeper
- reperform
Completeness assertion has what auditing procedure?
- tracing _ forward direction
- analytical review
- observation
Cutoff assertion assertion has what auditing procedure?
cutoff procedures - analyze transactions before or after year end for proper accounting period recognition.
Valuation, Allocation, and Accuracy involves what auditing procedures?
- Inspection
- Footing
- Independent recalculation - ex AR aging to check allowance acct, recalc depreciation, recalc estimates made by client.
- Reconciliation
Existence and Occurrence involve what audit procedures?
- Confirmation
- Observation, inspection, & examination
- Vouching - back to supporting documents.
Rights and obligations involve what audit procedures?
- inspection - inspect support docs,
Understandability of Presentation and Classification involves what sort of audit procedures?
- Inspection
- Review - for compliance
- Inquiry of management - regarding disclosures for the account and for related accounts.
Prescriptive Analytics
to prescribe or recommend
Predictive Analytics
expected or predicted outcomes
Diagnostic Analytics
explain why something happened
Descriptive Analytics
describes what is happening with the data Ex: AR aging data would summarized and describe the data.
Are bearer bonds a high risk or material misstatement due to misappropriation of assets? True or False? Why?
True because there is no registry to keep track of owners. Bearer bonds is strong indication of money laundering and tax evasion as well as concealing business transactions.
