Chapter 24 Instructor's Guide

Chapter 24 Instructor's Guide - Chapter 24 Completing the...

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Chapter 24 Completing the Audit We always cover completing the audit near the end of the course. The following are the topics we cover: Chapter opening vignette Overview Perform additional tests for presentation and disclosure-related audit objectives Review for contingent liabilities and commitments Review for subsequent events Final evidence accumulation Evaluate results Audit documentation review Communicate with the audit committee and management Additional problems Chapter Opening Vignette “Good Review Requires More Than Looking at Audit Files” A significant portion of the overall audit process consists of work being reviewed by supervisory personnel. Although this is both prudent and required by auditing standards, it is important to realize that review is inherently limited in terms of its effectiveness. This underscores the importance of staff doing a good job in the first place. If staff work sloppily thinking that their mistakes will get caught by reviewers, or if supervisors are lax in their delegation procedures thinking that they can compensate through review, audit risk is significantly increased. This vignette illustrates these concepts. Two other concepts covered in the vignette are the importance of the reviewer having a complete understanding of the client’s business and the use of independent analytical procedures as a part of the review. The combination of these two things enabled the manager to uncover the staff deficiencies. Overview We find this a good time to return to Figure 13-9 (page 426) for a review of what the auditor has done to this point, and where completing the audit fits in. Naturally, special emphasis is put on phase IV. (See Figure 13-9) 24-1
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Perform Additional Tests for Presentation and Disclosure-Related Audit Objectives (page 778) Throughout the various chapters focusing on the transaction cycles and related account balances, we have highlighted specific audit procedures performed to satisfy unique presentation and disclosure-related audit objectives, in addition to audit procedures performed to satisfy transaction-related audit objectives and balance- related audit objectives. However, we emphasize the importance of evaluating the need to perform additional audit procedures during Phase IV of the audit to satisfy the four presentation and disclosure-related audit objectives. Review question 24-1 can be used to help students focus on the four presentation and disclosure-related audit objectives first presented in Chapter 6. We emphasize that in Phase IV, the auditor evaluates the overall presentation
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This note was uploaded on 01/23/2010 for the course ACCOUNTING auditing taught by Professor Pro-abuel-ezz during the Spring '10 term at Cairo University.

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Chapter 24 Instructor's Guide - Chapter 24 Completing the...

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