Audit evidence

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What is the difference between audit and compliance?

Audit is an independent examination of business financial statements so as to issue opinion on whether the financial statement are prepared in accordance with acceptable financial reporting framework and show true performance and position of the business. Audit is conducted according to the requirements of countries laws and regulations and international standard on auditing. The auditor when conducting audit aim … Read the rest

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Auditor’s responsibility on going concern status of the entity.

Going concern  means that the enterprise will continue in operational existence for the foreseeable future without the intention or necessity of liquidation or otherwise ceasing trade. It is one of fundamental accounting concepts used by auditors  and is stated in IAS 1 presentation of financial statements.

The auditors responsibilities in respect of going concern is explained in ISA 570 going Read the rest

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Audit substantive procedures for non current assets.

Asset is resource controlled by an entity as the results of past events and from which future economic benefits are expected to flow to the entity. A non current asset is the asset that is unlikely to turn into unrestricted cash within one year of statement of financial position date.

The following substantive procedures should be applied for verification of

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What is risk of material misstatement?

6 advantages of computer based audit working papers

Audit documentation is the written record of the basis for the auditor’s conclusions that provides the support for the auditor’s representations, whether those representations are contained in the auditor’s report or otherwise.

The following are benefits of computer based audit working papers:

  • Preparation of working papers using computer becomes speedy and less costly;
  • It is
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Importance of maintaining and keeping audit working papers.

Audit working papers are documents which record all audit evidence obtained during financial auditing. Guidelines on how how to prepare and maintain working papers is given by ISA 230 Audit documentation. auditor is required to prepare on timely basis audit documentations that provide:

  • a sufficient appropriate record of the basis for the auditors report, and
  • the evidence that the audit
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Objectives of a limited assurance engagement.

The objective of a limited assurance engagement is a reduction in assurance engagement risk to a level that is
acceptable in the circumstances of the engagement, but where that risk is greater than for a reasonable
Assurance engagement, as the basis for a negative form of expression of the practitioner’s conclusion.

In a limited assurance engagement, the practitioner:
gathers sufficient … Read the rest

Revision question on audit evidence (NBAA,B3,NOV 2018)

(a)    In accordance with ISA 501: Audit Evidence – Specific Considerations for Selected Items, outline what an auditor should do:

(i)    To obtain sufficient appropriate audit evidence regarding the existence and condition of inventory where inventory is material to the financial statements.

(ii)   Where physical inventory counting is conducted at a date other than the date of the financial statementsRead the rest