risk assessment

Question 1

risk assessment procedueure
Primary purpose help audit planning

Answer 1

underhand entity/ (competitive , tech, long term contract)I Law, regulation, taxes. applicable frame work(gaap,ifrs.ocboa)
Security..(work from home), interest rate, money, inflation,

Internal control
AP-assist with planning
discussion with team (audit team)
inquiry mgm, Audit commudity

Question 2

other procedures

Question 3

nature of entity

Answer 3

read, look at sec file, Edgar research, inquiry of composition, exp research
management estimate (bias)

Question 4

business risk

Answer 4

too much inventory, unable to obtain money, pending law suit, change in technology.

Question 5

entity’s objective

Answer 5

reliability of fs (not lying), effective of I/C, (stealing) compliance with law and reg (cheating)

Question 6

cpa is required to understand

Answer 6

by Management risk assessment (what they think.. where the risk is.. example new business model, new personal, restructure.

Question 7

existing activities-paid tips

Answer 7

..prenumber doc (like check book)..
authrzaiton of transaction (sign approval)
Independent checks (bank rec) check and balance.. reconcile
Documents-paper trail
timely performance and reviewed
info processing control( general/app control.. valid, auth, property recorded)
Physical control/safeguard asset.. physical serration and security of asset,
authorize access to asset. ,
periodical count and comparison of actual assess
segreration of duty.ARC

Question 8

sampling

Answer 8

concept of risk (all item or some)
sample risk…same is not repressive of population.