S T U D Y G U I D E 2 . 3 3A third step involves group members considering the information identified in the first two steps and assessing the likelihood of fraud in the engagement. In the fourth step the group discusses potential audit responses to fraud risk. Questions such as ‘How would you go about committing the fraud if it were you?’ or ‘Where would you hide the debit?’ are addressed. The responses to these questions help the auditors determine how to alter the audit plan in order to address identified fraud risks. Question 2.7How could professional scepticism be encouraged during the discussion among the engagement team related to the susceptibility of the entity’s financial statements to material misstatement due to fraud?You should now read the remainder of ISA 240 covering sections 15 onwards and the related explanatory material (A12 onwards).
2 . 3 4 S T U D Y G U I D E
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