ITIS 3110 Network Auditing. overview networking refresh protocols refresh.
Continuation in Auditing Overview
Transcript of Continuation in Auditing Overview
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Assurance Services
Deal with the audit or review of historicalfinancial information and assurances dealingwith subject matters other than historicalfinancial information
Non- assurance Services
(Related Services)
Pertain to compilation of financial information,agreed-upon procedures and other relatedservices which do not result in the expressionof a conclusion that provides a level of
assurance
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1. Systematic process
2. Objectivity3. Obtaining and evaluating evidence
4. Assertions about economic events
5. Degree of correspondenceestablished criteria (closeness with
which the assertions can be identified
with established criteria)
6. Communicating results
7. Interested users
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Auditor
Must have a thorough understanding of the
entity and its environment (PSA 315). The
final stage of audit process is preparing the
Audit Report which is the communication of
the auditors findings to users.
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generally refers to an experts writtencommunication of a conclusion about thereliability of someone elses assertions. It occurswhen a practitioner is engaged to issue a written
communication that expresses a conclusionabout the reliability of a written assertion that isthe responsibility of another party. Attestationservice is a type of ASSURANCE SERVICEwhose subject matter (both financial and non-financial in nature) is the responsibility of anotherparty. It includes audit and reviews.
Attestation
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Assurance Services
are designed to enhance the degree of
confidence of the intended users other
than the responsible party about the
outcome of the evaluation ormeasurement of a subject matter against
criteria. They pertain to independent
professional services designed to improvethe quality of information for decision
making. Broader in scope than auditing
and attestation
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Examples
Risk Assessment- environmental risk, business
process, asset and information risks
Information system reliability Adequacy of security over electronic
transactions
Effectiveness of health care performancemeasurement systems
Reliability and relevance of business
performance measurement
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ASSURANCE
AUDIT
OTHERS
REVIEW
FinancialStatementsAudit
Audits of
InternalControlOverFinancial
*Examination ofProspectiveFinancialInformation
*CPAPerformance View
* CPA RiskAdvisory
*Review ofFinancialStatements
*Review of
interiminformation
RELATED SERVICES(Non-Assurance)
*Agreed-upon
procedures*Compilation of
financial orotherinformation
*Preparation of tax
returns and taxconsulting
*Managementconsulting
*Other advisoryservices
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Consulting Services
Are professional services that provide advice
and assistance concerning an entitysorganization, personnel, finances,
operations, systems or other activities.
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Includes the following
1. Consultations
2. Advisory
3. Implementation4. Transactions
5. Staff and other support
6. Product
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Assurance Consulting
Services Services
1. Parties involved Three-party contracts Two-party contracts
2. Primary purpose To improve quality of To recommend
information uses for information
3. Focus Decision makers and Outcomesinformation used for
optimum decisions
4. Outputs objective intended to improve to improve clients decision makers condition condition directly
indirectly through recommen- through findings,
dations conclusions and
recommendations
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Auditing vs. Accounting
-Auditing is primarily concerned with the
verification of financial statement information
and its fairness, emphasizing evidence andthe odds.
-A financial statement is the object of auditing, is
generated by the accounting system that deals
with the collecting, sorting, summarizing and
reporting financial measurements, plus
interpreting financial information.
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Types of Audit
1. Management Audit
2. Performance Audit
3. Comprehensive Audit4. Environmental Audit
5. Forensic Audit eg. Sales records to
determine the quantum of rent owing undera lease agreement, which is the subject of
litigation
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Types of Assurance
EngagementsReasonable Assurance
Objective- Reduction in assurance engagementrisk to an acceptably low level in the circumstanceof the engagement
Conclusion- Positive form of expressionLimited Assurance
Objective- Reduction in assurance engagementrisk to a level that is acceptable in the
circumstance of the engagement, but where thatrisk is greater than for a reasonable assuranceengagement as the basis for conclusion
Conclusion- Negative form of expression
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The Professional Standards
Standards- are established to measure the quality of
performance of individuals and organizations
The Board of Accountancy promulgated 10
generally accepted auditing standards (GAAS) PSAs are issued to clarify the meaning of these 10
GAAS.
Auditing procedures are the means used by the
auditors in attaining the quality required by the
standards.
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GAAS
represent measures of the quality of the
auditors performance
These are grouped into GENERAL,
FIELDWORK, REPORTING STANDARDS.
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General Standards
Technical Training and Proficiency Independence
Professional Care
Standards of Fieldwork
Planning
Internal Control Consideration Evidential Matter
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Reporting Standards
Generally Accepted Accounting Principles
Inconsistency
Disclosure Opinion
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System of Quality Control
It is only by implementing quality control
policies and procedures that CPAs can
ensure that all members of the audit teams
perform the same level of quality of work.
Quality Control
These are policies and procedures adoptedby CPAs to provide reasonable assurance of
conforming with professional standards in
performing audit and related services
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Ethical Requirements
Integrity
Objectivity
Professional Competence and due care Confidentiality
Professional Behavior