Auditing Ritter 审计学基于的环境变化的概念ch07.pptVIP

Chapter 7 Audit Evidence: A Framework for Directly Testing Account Balances and Transactions Overview Auditing is a process of objectively gathering, evaluating, and documenting the evidence needed to provide assurance on the financial statements In planning an audit, three questions need to be answered: What audit procedures should be performed? How much evidence is needed? When should the audit procedures be performed? The audit programs detail the auditors plan to gather, evaluate, and document evidence Overview (continued) The evidence gathering process is the core of the audit; evidence is needed to Reduce audit risk Support the opinion In deciding which evidence to gather, the auditor considers Risk associated with an account balance or other measures of performance Types of evidence available Reliability of alternative sources of evidence Define the Third Standard of Fieldwork Sufficient, competent evidential matter is to be obtained through audit procedures performed to afford a reasonable basis for an opinion regarding the financial statements under audit What is the assertion model? The auditor gathers evidence to evaluate the management assertions embodied in the financial statements and individual accounts Existence or occurrence Completeness Rights and obligations Valuation or allocation Presentation and disclosure Review Gathering Sufficient, Competent Evidence Because each audit is unique, there is no set amount or type of evidence that must be gathered When considering the best approach to gather evidence, the auditor needs to consider factors affecting the reliability of the financial data: Management integrity Client economic risk Quality of clients information system Clients control structure Current market conditions and competitor actions List the Steps in the Overall Audit Process 1. Understand the client and industry 2. Assess environment risk 3. Directly test transactions and/or account balances 4. Assess adequacy of evidence Discuss Suffi