semi-enumeration Flashcards
7 CHARACTERISTICS OF CIS
-LACK OF VISIBLE TRANSACTION TRAILS
-CONSISTENCY OF PERFORMANCE
-EASE OF ACCESS TO DATA AND COMPUTER PROGRAMS
-CONCENTRATION OF DUTIES
-SYSTEM GENERATED TRANSACTION
-VULNERABLILITY OF DATA AND PROGRAM STORAGE MEDIA
-INTERNAL CONTROL IN A CIS ENVIRONMENT
5 GENERAL CONTROLS
-ORGANZATIONAL CONTROLS
-SYSTEM DEVELOPMENT AND DOCUMENTATION CONTROLS
-ACCESS CONTROLS
-DATA RECOVERY CONTROLS
-MONITORING CONTROLS
6 EXAMPLES OF INPUT CONTROLS
-KEY VERIFICATION
-FIELD CHECK
-VALIDITY CHECK
-SELF-CHECKING DIGIT
-LIMIT CHECK
-CONTROL TOTALS
3 GENERALIZATIONS THAT MAY BE HELPFUL IN ASSESSING THE PREDICTABILITY OF THE
ACCOUNTS
-INCOME STATEMENT ACCOUNTS
-ACCOUNTS THAT ARE NOT SUBJECT TO MANAGEMENT DISCRETION
-RELATIONSHIP IN A STABLE ENVIRONMENT
6 FUNCTIONS OF WORKING PAPERS (3 PRIMARY/3 SECONDARY)
PRIMARY
-SUPPORT THE AUDITOR’S OPINION ON FINANCIAL STATEMENTS
-SUPPORT THE AUDITOR’S REPRESENTATION COMPLIANCE WITH PSA; AND
-ASSIST THE AUDITOR IN THE PLANNING, PERFROMANCE, REVIEW AND SUPERVISION OF THE ENGAGEMENT.
SECONDARY
-PLANNING FUTURE AUDITS;
-PROVIDING INFORMATION USEFUL IN RENDERING OTHER SERVICES; (MAS AND TAX CONSULTANCY); AND
-PROVIDING ADEQUATE DEFENSE IN CASE OF LITIGATION
7 FACTORS WHERE THE FORM, CONTENT AND EXTENT OF AUDIT DOCUMENTATION
-THE NATURE OF THE AUDIT PROCEDURES TO BE PERFROMED;
-THE IDENTIFIED RISK OF MATERIAL MISSTATEMENTS;
-THE EXTENT JUDGEMENT REQUIRED IN PERFORMING THE WORK AND EVALUATING THE RESULTS;
-THE SIGNIFICANCE OF THE AUDIT EVIDENCE OBTAINED;
-THE NATURE AND EXTENT OF EXCEPTIONS IDENTIFIED;
-THE NEED TO DOCUMENT A CONCLUSION OR THE BASIS FOR A CONCLUSION NOT READILY DETERMINABLE FROM THE DOCUMENTATION OF THE WORK PERFORMED OR AUDIT EVIDENCE OBTAINED; AND
-THE AUDIT METHODOLOGY AND TOOLS USED.
7 EXAMPLES OF AUDITING ACCOUNTING ESTIMATES
-ALLOWANCE FOR CREDIT LOSSES;
-WARRANTY OBLIGATION;
-INVENTORY OBSOLESCENCE;
-DEPRECIATION AND AMORTIZATION;
-LOSS CONTINGENCIES;
-PERCENTAGE OF COMPLETION INCOME ON CONSTRUCTION CONTRACTS; AND
-FAIR VALUE OF SECURITIES THAT ARE NOT PUBLICLY TRADED.
6 EXAMPLES OF CONDITIONS RELATED PARTY TRANSACTIONS ARE LIKELY
-TRANSACTIONS WHICH HAVE ABNORMAL TERMS OF TRADE SUCH AS UNSUAL PRICES, INTEREST RATES, GUARANTEES AND REPAYMENT TERMS;
-TRANSACTIONS WHICH LACK IN APPARENT LOGICAL BUSINESS REASON FOR THEIR OCCURENCE;
-TRANSACTIONS IN WHICH SUBSTANCE DIFFERS FROM FORM;
-TRANSACTIONS NOT PROCESSED IN AN UNBIASED MANNER
-HIGH VOLUME OR SIGNIFICANT TRANSACTIONS WITH CERTAIN CUSTOMERS OR SUPPLIERS AS COMPARED WITH OTHERS; AND
-UNRECORDED TRANSACTIONS SUCH AS THE RECIEPT OR PROVISION OF MANAGEMENT SERVICES AT NO CHARGE
3 COMMON EXAMPLES OF AN EXPERTS WORK
-VALUATION OF PRECIOUS STONES, WORKS OF ARTS, REAL STATE AND OTHER SPECIALIZED ASSET;
-DETERMINATION OF AMOUNTS USING SPECIALIZED TECHNIQUES LIKE ACTUARIAL COMPUTATIONS; AND
-INTERPRETATION OF TECHNICAL REQUIREMENTS, REGULATIONS OR CONTRACTS SUCH AS LEGAL DOCUMENTS OR LEGAL TITLE TO PROPERTY.
6 BASIC STEPS IN AUDIT SAMPLING
-DEFINE THE OBJECTIVE
-DETERMINE THE PROCEDURE
-DETERMINE THE SAMPLE SIZE
-SELECT THE SAMPLE
-APPLY THE PROCEDURES
-EVALUATE THE RESULTS
4 FACTORS TO CONSIDER WHEN DETERMINING SAMPLE SIZE FOR SUBSTANTIVE TESTS
-ACCEPTABLE SAMPLING RISK
-TOLERABLE MISSTATEMENT
-EXPECTED MISSTATEMENT
-VARIATION IN THE POPULATION
4 SERIES OF PROCEDURES GENERALLY CARRIED OUT TO COMPLETE THE AUDIT
-IDENTIFYING SUBSEQUENT EVENTS THAT MAY AFFECT THE FINANCIAL STATEMENT UNDER AUDIT
-IDENTIFYING THE LITIGATION AND CLAIMS
-OBTAINING THE WRITTEN MANAGEMENT REPRESENTATION; AND
-PERFORMING WRAP-UP PROCEDURES
5 PROCEDURES TO IDENTIFY SUBSEQUENT EVENTS
-INQUIRING OF MANAGEMENT AS TO THE OCCURENCE OF SUBSEQUENT EVENTS;
-REVIEWING PROCEDURES MANAGEMENT HAS ESTABLISHED TO ENSURE THAT SUBSEQUENT EVENTS ARE IDENTIFIED;
-READING THE MINUTES OF BOARD OF DIRECTORS AND STOCKHOLDER’S MEETING AFTER THE FINANCIAL STATEMENT DATE;
-READING THE LATEST AVAILABLE SUBSEQUENT INTERIM FINANCIAL STATEMENTS AS WELL AS MANAGEMENT REPORTS SUCH AS BUDGETS AND FORECAST; AND
-INQUIRING OF THE ENTITY’S MANAGEMENT LAWYERS CONCERNING LITIGATION, CLAIMS AND ASSESSMENTS.
5 FORM AND CONTENT OF A WRITTEN MANAGEMENT REPRESENTATION LETTER
-A REPRESENTATION THAT MANAGEMENT HAS FULLFILLED ITS RESPONSIBILITY FOR THE PREPARATION AND PRESENTATION OF THE FINANCIAL STATEMENTS AS SETS OUT IN THE TERMS OF THE ENGAGEMENT;
-A REPRESENTATION THAT THE FINANCIAL STATEMENTS ARE PREPARED AND PRESENTED IN ACCORDANCE WITH THE APPLICABLE FINANCIAL REPORTING FRAMEWORK;
-A REPRESENTATION THAT MANAGEMENT HAS PROVIDED THE AUDITOR WITH ALL RELEVANT INFORMATION AGREED IN THE TERMS OF THE ENGAGEMENT AND THAT ALL TRANSACTIONS HAVE BEEN RECORDED AND REFLECTED IN THE FINANCIAL STATEMENTS;
-A REPRESENTATION THAT DESCRIBES THE MANAGEMENT’S RESPONSIBILITIES AS DESCRIBED IN THE TERMS OF THE ENGAGEMENT; AND
-OTHER REPRESENTATIONS REQUIRED BY OTHER PSAs.
7 EXAMPLES OF CONDITIONS OR EVENTS THAT MAY CAST SIGNIFICANT ABOUT GOING
CONCERN ASSUMPTION
-NON-COMPLIANCE WITH THE TERMS OF LOAN AGREEMENTS OR OTHER STATUTORY REQUIREMENTS;
-PENDING MAJOR LEGAL OR REGULATORY PROCEEDINGS;
-CHANGES IN LEGISLATION OR GOVERNMENT POLICY EXPECTED TO ADVERSELY AFFECT THE ENTITY;
-NET LIABILITY OR NET CURRENT LIABILITY
-SUBSTANTIAL OPERATING LOSSES;
-INABILITY TO PAY CREDITORS ON DUE DATES; AND
-LOSS OF MAJOR MARKET, FRANCHISE, LICENSE OR PRINCIPAL SUPPLIER
