EP AUDITING+ASSURANCE...-MYACCT.LAB
16th Edition
ISBN: 9780134148656
Author: ARENS
Publisher: PEARSON CO
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Textbook Question
Chapter 9, Problem 30DQP
This problem requires you to access PCAOB Auditing Standard No. 12, Identifying and Assessing Risks of Material Misstatements (pcaobus.org). Use this standard to answer each of the questions below. For each answer, document the paragraph(s) in AS No. 12 supporting your answer.
Required
- a. What types of information does AS No. 12 suggest the auditor should consider when obtaining an understanding of the company and its environment?
- b. What types of performance measurements might affect the risk of material misstatement?
- c. What specific issues should be included in the discussion among engagement team members regarding the risk of material misstatement?
- d. What factors should the auditor consider to determine if a risk is a “significant risk”?
- e. What guidance is provided about revising the risk assessment as the audit continues?
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Please access PCAOB Auditing Standard No. 12 "Identifying and Assessing Risks of Material Misstatements" (pcaobus.org). Use this standard to answer each of the questions below. For each answer, document the paragraph(s) in AS No. 12 supporting your answer.
a. What types of information does AS No. 12 suggest the auditor should consider when obtaining an understanding of the company and its environment?
b. What types of performance measurements might affect the risk of material misstatement?
c. What specific issues should be included in the discussion among engagement team members regarding the risk of material misstatement?
d. What factors should the auditor consider to determine if a risk is a "significant risk"?
e. What guidance is provided about revising the risk assessment as the audit continues?
You are required to read the following statement carefully, and then, discuss the factors behind the statement content, stating examples of how this content can be implemented: "Auditors develop overall audit plans to ensure that they obtain sufficient appropriate audit evidence. The timing and extent of audit procedures auditors use is a matter of professional judgement, which depends upon a number of factors".
Plz don’t make it long answer
1. Please explain how to Evaluate the Data Reliability When Developing Expectations. The data an auditor will use to develop expectations in the acquisition and payment cycle has been deemed reliable by the audit staff.
2. Please Discuss the likely factors the audit team will consider when making this determination.
Chapter 9 Solutions
EP AUDITING+ASSURANCE...-MYACCT.LAB
Ch. 9 - Prob. 1RQCh. 9 - Prob. 2RQCh. 9 - Provide two examples of factors that might...Ch. 9 - Prob. 4RQCh. 9 - Prob. 5RQCh. 9 - Prob. 6RQCh. 9 - Prob. 7RQCh. 9 - Prob. 8RQCh. 9 - Prob. 9RQCh. 9 - Prob. 10RQ
Ch. 9 - Prob. 11RQCh. 9 - Prob. 12RQCh. 9 - Prob. 13RQCh. 9 - Prob. 14RQCh. 9 - Prob. 15RQCh. 9 - Prob. 16RQCh. 9 - Prob. 17RQCh. 9 - Prob. 18RQCh. 9 - Prob. 19RQCh. 9 - Prob. 20RQCh. 9 - Prob. 21RQCh. 9 - Prob. 22RQCh. 9 - Prob. 23RQCh. 9 - Prob. 24RQCh. 9 - Prob. 25.1MCQCh. 9 - Prob. 25.2MCQCh. 9 - Prob. 25.3MCQCh. 9 - Prob. 26.1MCQCh. 9 - Prob. 26.2MCQCh. 9 - Prob. 26.3MCQCh. 9 - Prob. 27.1MCQCh. 9 - Prob. 27.2MCQCh. 9 - Prob. 27.3MCQCh. 9 - Prob. 28.1MCQCh. 9 - Prob. 28.2MCQCh. 9 - Prob. 28.3MCQCh. 9 - Prob. 29DQPCh. 9 - This problem requires you to access PCAOB Auditing...Ch. 9 - Prob. 31DQPCh. 9 - Prob. 32DQPCh. 9 - Prob. 33DQPCh. 9 - Prob. 34DQPCh. 9 - Prob. 35DQPCh. 9 - Prob. 36DQPCh. 9 - Prob. 37DQPCh. 9 - Prob. 38C
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Refer to Exhibit 2.5 and answer the following questions. a. (Sections 101, 104, and 105) How does the establishment and operation of the PCAOB help to ensure quality external audits? How will audit firm inspections and investigations by the PCAOB help ensure high audit quality? b. (Sections 201-203) How do Sections 201-203 address audit ()r independence concerns? c. (Section 206) What is a cooling-off period, and how does it address auditor independence concerns? d. (Section 301) How do the audit committee requirements help ensure effective corporate governance? e. (Sections 302 and 906) How do the officer certification requirements help to address the risk of fraud in publicly traded organizations? What is the likelihood that a CFO who is committing fraudulent financial reporting would sign the certification falsely, and what are your reactions to that possibility? f. (Section 401) How does this section relate to the Enron fraud? g. (Section 404) How do the management assessment and audit or attestation of internal controls contained in this section help to address the risk of fraud in publicly traded organizations? h. (Section 407) Why is it important that at least one member of the audit committee be a financial expert? What are the financial reporting implications if the audit committee does not have any individuals serving on it who possess financial expertise? i. (Section 802) How does this section relate to the Enron fraud?arrow_forward1. List three reasons management may ask for an operational audit to be performed and explain how the audit program would be impacted by each of them. 2. Explain the importance of identifying risk factors and using them during the planning phase. 3. Give two examples where document inspection is a useful technique to examine operational risks and related controls. 4. Explain professional skepticism and why it is important for all auditors. 5. Explain the acronym CCCER. 6. What are the defining characteristics of persuasive audit evidence? 7. What are the key characteristics of well prepared working papers? 8. What do internal auditors mean when they refer to the nature, extent, and timing of audit procedures? 9. What information should be included in a well designed final assurance engagement communication? 10. What actions regarding assurance engagement observations must the internal audit function take after the final engagement communication is disseminated?arrow_forwardAuditors identify and assess the risk of material misstatement at these two levels Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a Financial Statement level and Information Process Goals level b Financial statement level and Operations Process Goals level c Information Process Goals level and Operations process goals level d Financial Statement Level and Relevant Assertion Levelarrow_forward
- What are the objectives of an audit risk assessment? Explain why a risk assessment performed during audit planning sets the tone for the entire audit engagement. Also comment on how the concept of ‘risk assessment’ might be useful for any accountant at the outset of any assignment, including non-audit work.arrow_forwardA document created by the organization and requested from the organization by an internal auditor would provide what level of reliability? A) High B Medium C Low D) Absolutearrow_forward1. What are the evidence garthering techniques Used in Information System Auditing by Internat auditors? 2. What are the evidence garthering techniques Used in Information System Auditing by external auditors? 3. what is the different between Internal and external auditors and what privilleges do internal auditors has than external. 4. By answering these questions use accessible reference and provide their link for me to read after, prefereable references are from ResearchGate, IEE and other accademic repository. 5. Use intext citations.arrow_forward
- Auditing and Assurance Services Can you help me identify which of the performance principles of GAAS apply to each of these? I am not sure what I am missing. Thanks!arrow_forwardWhen testing IT controls, which of the following BEST (select one) describes the IT auditor's focus: a) Assessing the alignment of the IT controls, in relation to an industry framework. b) Assessing the design and operating effectiveness of the controls. c) Evaluating the scope and objectives of the IT controls. d) Evaluating the need for post-audit substantive testing.arrow_forwardAuditors need to identify audit risk in planning an audit engagement. In doing so, the audit risk model may be adopted. Require:Write the audit risk model in the two common ways it is often used by auditor. Each risk should be written in the model or named clearly for any abbreviations used.arrow_forward
- Outline the advantages of utilizing audit software in an audit of Discuss the potential challenges that may arise during an audit and for each challenge, propose a solution to overcome it.arrow_forwardYou have been asked by the audit manager to undertake preliminary analytical procedures.a) Identify the sources of information from which an auditor develops expectations.b) Describe the factors that influence an auditor’s consideration of the reliability of data for purposes of achieving audit objectives.arrow_forwardits components. The firm of Pack & Peck evaluates the risk of material isstate- -1,4-2, 4-3 4-27 When planning a financial statement audit, a CPA must understand au sk its components. The firm of Pack & Peck evaluates the risk of materiai ment (RMM) by disaggregating RMM into its two components: inherentisk and control risk. Required: For each illustration, select the component of audit risk that is most directly illus- trated. The components of audit risk may be used once, more than once, or not at all Components of Audit Risk: a. Control risk b. Detection risk c. Inherent risk Component of Audit Risk Illustration 1. A client fails to discover employee fraud on a timely basis because bank accounts are not reconciled monthly. 2. Cash is more susceptible to theft than an inventory of coal. 3. Confirmation of receivables by an auditor fails to detect a material misstatement. 4. Disbursements have occurred without proper approval. 5. There is inadequate segregation of duties. 6. A…arrow_forward
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