Audit Risk and Materiality

Audit Risk and Materiality - Request management to examine...

Info iconThis preview shows pages 1–7. Sign up to view the full content.

View Full Document Right Arrow Icon
Click to edit Master subtitle style 1/21/11 Audit Risk and Materiality Audit wrap-up
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
1/21/11 Communication of Misstatements to Must accumulate all know and likely misstatements identified other than trivial Communicate to appropriate levels of management Distinguish between known and likely
Background image of page 2
1/21/11 Known Misstatements Incorrect selection or misapplication of accounting principles Misstatements of facts identified Mistakes in gathering or processing data Overlooking of misinterpretation of facts
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
1/21/11 Likely Misstatements Differences between management's and auditor’s judgments on estimates Unreasonable and inappropriate Extrapolation from audit evidence
Background image of page 4
1/21/11 Communications to Mgmt (cont.) Request management correct all known misstatements Also effect of prior period misstatements
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 6
Background image of page 7
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Request management to examine likely misstatements from extrapolation Request management to review assumptions and methods for 1/21/11 Evaluating Audit Findings Consider individual and aggregate effects Known and likely Individually Effects on individual accounts or disclosures Whether it is appropriate to offset misstatements 1/21/11 Qualitative consideration Trends, profitability Loss to income Compliance Statutory requirements Mgmt compensation Sensitivity Significance of affected element User needs Characterprecision, subjectivity Motivation of management Offsetting effects Future periods Cost of correcting Additional undetected misstatements...
View Full Document

This note was uploaded on 01/20/2011 for the course ACC 603 taught by Professor Robertj.ramsay during the Spring '10 term at Kentucky.

Page1 / 7

Audit Risk and Materiality - Request management to examine...

This preview shows document pages 1 - 7. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online