Class Notes (834,721)
Canada (508,692)
Accounting (213)
ACCT 3280 (7)
Hiscock (4)
Lecture

Chapter 6 - Preliminary Auditing, Planning, Understanding the Auditee.docx

9 Pages
78 Views
Unlock Document

Department
Accounting
Course
ACCT 3280
Professor
Hiscock
Semester
Summer

Description
Chapter 6 preliminary auditing planning understanding the auditee Preengagement arrangements Pre audit risk management activitiesreduce risk by carefully managing the engagement Risk in an audit engagement refers to the probability that something will go wrong that might lead to the financial statements being misstates Audit engagement acceptance and continuanceAcceptance and continuance decisions involve the following policies and procedures1 Obtain and review financial information about the prospective auditee organization to determine the purpose and main users of financial statements and the basis of accounting being used2 Evaluate the public accounting firms and individual auditorsindependence and ability to comply with other relevant ethical requirements with regard to the prospective auditee 3 Consider whether the public accounting firm has the competency and resources to perform the audit including any need for special skills 4 Obtain info from the prospective auditees management in order to understand the business and its risks and to assess whether the organizations managers and those charged with its governance are willing and able to accept responsibilities for preparing financial statements in accordance with an acceptable financial reporting framework and for implementing adequate controls to reduce risk of error and fraud 5 Consider whether the engagement requires special attention or involves unusual risks6 Search for information about the organization by looking for news reports and when possible asking the prospective auditees banker legal counsel underwriter or other business associates about the organization giving particular attention to any indicators relating to the integrity of principle owners manager or those charged with its governance7 For new audit communicate with the previous auditor if possible for information on the integrity of management on disagreements with management about accounting principles and procedures or similar matters and on the reasons for a change of auditorsDetermining auditabilityAuditor must determine whether the organization is auditable Statements must be presented in accordance with GAAP or some other acceptable reporting frameworkManager must be willing to provide all required information and to grant the auditor unrestricted access to records documentation and any other needed sources
More Less

Related notes for ACCT 3280

Log In


OR

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


OR

By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.


Submit