Evaluating audit risk components

Article Abstract:

The first step in audit planning is to identify relevant risk factors. The level of compliance and transaction tests needed to achieve the desired risk can then be determined. The highest inherent risks are presented by stocks, debtors, and creditors accounts. The auditor's evaluation of the ability of the chief accounting officer can also be valuable. When companies do poorly, they are more likely to make errors of omission in reporting non-routine transactions, which can lead to overstatements of profit. These risk factors will have an effect on audit sample size.

Accounting and auditing, Risk management

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Auditing guideline: analytical review

Article Abstract:

The principles underlying the application of auditing analytical review procedures are described. Factors to be considered when conducting an analytical review are identified. Auditing terms are defined. Factors determining extent of use include nature of the enterprise, knowledge of the client, and procedures to be followed. Steps to follow in the planning stage at the detailed testing stage are discussed along with review at the financial statements stage. Controlling and recording data are also discussed.

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Similar abstracts:

• Abstracts: Auditing guideline: reports to management (guideline from the Institute of Chartered Accountants in England and Wales)

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