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Syllabus: CICTA 101
SYLLABUS CICTA 101 - AUDITING 1 - INTERMEDIATE 1
10.0 AUDITING I - INTERMEDIATE I - SYLLABUS
10.1 Course Objective
To help provide academic and professional insights into Auditing as a subject discipline
10.2 Course Description
The course is designed to assist students to appreciate the significance of Auditing in corporate and non - corporate entities. The nature, purpose, scope, objectives and limitations of auditing are among the main highlights. Audit planning, evidence and reporting framework are among the core topics.
10.3.1 The Nature, Purpose and Scope of Auditing
The development of auditing, background and significance of auditing
* Distinctions between external auditor, internal auditor and the tax auditor
* Application of the international auditing standards including other statutory documents e.g. the
Companies Code and the International Financial Reporting Accounting Standards (IFRS), IAS, etc.
* The ethical base of auditing
* Notion of accountability, stewardship and agency
* The social concept of an audit and its changing role
* The virtue of truth and fairness as applied in auditing
10.3.2 The Regulatory Framework of Auditing
Auditing Standards, their nature, purpose, scope and development.
* Legislation and the auditor; the development and impact of statute law, case law etc.
* The role of the government in relation to auditing
* Supervision and monitoring of auditors
* The role and responsibilities of bodies which set Auditing Standards and Guidelines
* The roles of parties in relation to auditing including the Audit Commission, National Audit
Service, Recognised Supervisory Bodies, Directors responsibilities and Audit Committee (with reference to their contribution to corporate governance)
10.3.3 Fundamental Principles and Concepts
Independence, objectivity and integrity
* Audit evidence and documentation
* Due care, skill and competence
* Audit risk
* Materiality and judgement
* True and fair view
* Audit reporting as a communication medium
* Audit planning and supervision
10.3.4 The Framework of Auditing
The application of fundamental auditing principles and concepts
* The application of Auditing Standards and Guidelines
* The requirements of the Companies? Code
* The legal liability of auditors and their professional obligations
* The auditor?s responsibility for the detection and reporting of fraud
* The statutory and ethical considerations relating to the acceptance and continuance of audit clients
* Terminating professional engagements and factors affecting such decisions.
* Preparing, issuing and revising engagement letters.
10.3.5 Audit Planning and Evaluation
Establishing the objectives, scope and critical aspects of an audit
* Developing the audit plan to meet those objectives
* Identification of sources of audit evidence, audits relationship and audit objectives
* Establishing materiality levels, statistical sampling and sampling size
* Determining the areas of audit risk and the consideration of inherent risk, control risk and detection risk
* Analysing the consistency of financial and related information by substantive analysis (including analytical review)
* Designing, documenting and re - evaluation of the audit plan
* Evaluating the management information systems.
10.3.6 Evidence of Collection and Analysis
Collective evidence using a variety of sources and methods
* Selecting audit procedures appropriated to the business
* Identifying and applying sampling techniques
* Evaluating the evidence collected
* Recognising mutual co-operation, similarities and differences in the work of the internal and external auditors.
* Recognising the needs and limitations of the use of specialists.
10.3.7 Performance of An Audit
Determining the internal control systems and documenting the system
* Designing the audit programme.
* Evaluating internal controls.
* Performing compliance tests on the system.
* Evaluating the results of tests and the re-evaluation of inherent and control risk
* Applying substantive analysis, substantive sampling and the evaluation of test results.
* Determining and analysing the interrelationship of tests.
* Altering, modifying tests in the light of test results.
* Comparing test results with evidence from other tests, critical audit objectives, risk evaluation and materiality levels
* Responding to potential weaknesses in the system and areas of concern evidenced by substantive tests.
* Utilising Computer Assisted Auditing Techniques (CAATs) and testing management information systems controls.
* Impact of relevant legislation on the performance of an audit
* Performing substantive procedures in relation to balance sheet items and evaluating the sufficiency, relevance and reliability of evidence and the amendment of the audit plan
* Evaluating the quality of the audit.
10.3.8 Reporting Framework
Evaluating the sufficiency, relevance and reliability of audit evidence
* Evaluating the sufficiency, relevance and reliability of audit evidence
* Reviewing subsequent events, going concern status, management representations and the truth and fairness of financial statements.
* Identifying and recommending appropriate action on weaknesses found during the audit.
* Formulating an audit opinion
* Issuing management letters, the principles and practices.
* Advising management of improvements in business systems.
* Preparing a formal audit report, and the form of audit qualifications
* Determining the potential effects of audit qualifications
* Evaluating and determining the circumstances in which it is necessary to qualify audit reports