When it's double or nothing in assessing audit risk
Article Abstract:
Auditors need to be aware of the relationship between inherent risk factors and reportable conditions and to realize how the elements that are common to both of them affect their work. Reportable conditions are either deficiencies in control structure design, poor control structure operation, or any other control related deficiencies. Reportable conditions affect several elements of the control structure including: control environment; accounting systems; and control procedures. Inherent risk is the risk that errors may occur regardless of internal controls. Inherent risk, control risk, and detection risk are the main elements of individual audit risk, and they can be modeled so that audit risk is always equal to the multiplicative product of inherent risk, control risk, and detection risk. Auditors also need to be aware that some items are both reportable conditions and inherent risk factors, and that these factors can have major effects on the audit risk model and reporting policies.
Publication Name: The Woman CPA
Subject: Women's issues/gender studies
ISSN: 0043-7271
Year: 1989
User Contributions:
Comment about this article or add new information about this topic:
A guide to analytical procedures
Article Abstract:
Auditors can effectively check for material errors in their clients' financial statements by using analytical procedures. The American Institute of Certified Public Accountants has made the use of these procedures imperative during the planning and review phases of the audit, but optional as a substantive test. It is therefore important for auditors to know and understand the various types of analytical procedures that are available for their use. The more popular ones are reasonableness tests, trend analysis, and ratio analysis.
Publication Name: The Woman CPA
Subject: Women's issues/gender studies
ISSN: 0043-7271
Year: 1991
User Contributions:
Comment about this article or add new information about this topic: