SAS109_Risk_Assessment_Standards

SAS109_Risk_Assessment_Standards - P1: JsY...

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Unformatted text preview: P1: JsY AICP034-p1371-1728 AICPA034-PS.cls June 30, 2006 11:26 Statement on Auditing Standards No. 109 1611 Statement on Auditing Standards No. 109 Understanding the Entity and Its Environment and Assessing the Risks of Material Misstatement (Together with Statement on Auditing Standards No. 110, supersedes Statement on Auditing Standards No. 55, Consideration of Internal Control in a Financial Statement Audit , as amended, AICPA, Professional Standards .) Contents of Statement Paragraph Introduction.................................................................. 1-4 Risk Assessment Procedures and Sources of Information About the Entity and Its Environment, Including Its Internal Control .............................. 5-20 Risk Assessment Procedures ......................................... 6-13 Discussion Among the Audit Team .................................. 14-20 Understanding the Entity and Its Environment, Including Its Internal Control................................................................ 21-101 Industry, Regulatory, and Other External Factors ..................... 24-25 Nature of the Entity ................................................. 26-28 Objectives and Strategies and Related Business Risks ................ 29-33 Measurement and Review of the Entitys Financial Performance ...... 34-39 Internal Control .................................................... 40-101 Assessing the Risks of Material Misstatement.................................. 102-121 Significant Risks That Require Special Audit Consideration ........... 110-116 Risks for Which Substantive Procedures Alone Do Not Provide Sufficient Appropriate Audit Evidence ............................ 117-120 Revision of Risk Assessment ......................................... 121 Documentation .............................................................. 122-123 Effective Date................................................................ 124 Appendix A: Understanding the Entity and Its Environment Appendix B: Internal Control Components Appendix C: Conditions and Events That May Indicate Risks of Material Misstatement AU RAS P1: JsY AICP034-p1371-1728 AICPA034-PS.cls June 30, 2006 11:26 1612 Risk Assessment Standards: SAS No. 104--SAS No. 111 Introduction 1. This Statement establishes standards and provides guidance about im- plementing the second standard of field work, as follows: The auditor must obtain a sufficient understanding of the entity and its envi- ronment, including its internal control, to assess the risk of material misstate- ment of the financial statements whether due to error or fraud, and to design the nature, timing, and extent of further audit procedures....
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This note was uploaded on 08/26/2011 for the course AGS 4401 taught by Professor Henry during the Spring '11 term at FIU.

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SAS109_Risk_Assessment_Standards - P1: JsY...

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