ugaud.ch4 - financial statements fin stmt business...

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11 } financial statements fin. stmt. business processes management assertions general audit objectives Sufficient, competent audit evidence must be gathered to support/refute management assertions . audit procedures Chapter 4 the business process approach
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22 Audit Procedures: Specific acts performed by the auditor to gather evidence to determine whether specific assertions are being met. Risk assessment procedures Tests of controls Substantive Procedures
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33 Substantive audit testing is the process of obtaining evidence in support of transactions and balances Examples of tests of balances: Confirming A/R Observing Inventory taking Reconciling Bank Balances Examples of tests of transactions: Plant asset additions R&D expenditures Purchases and sales of marketable securities
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44 Audit Program n A set of audit procedures prepared to test assertions for a component of the financial statements is referred to as an audit program . Management Assertions Audit Procedures Existence Confirm receivables. Rights and Obligations Ask if receivables have been sold. Completeness Agree controlling account with total of subsidiary accounts. Examine sales invoices immediately before and after year-end for proper cutoff.
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ugaud.ch4 - financial statements fin stmt business...

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