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Why do Auditors use Substantive Procedures?
Substantive procedures performed by the auditor during the substantive testing stage of the audit that gather evidence as to the completeness, validity and/or accuracy of account balances and underlying classes of transactions.
Why do test of control in auditing?
Tests of controls in auditing are performed to evaluate the effectiveness of an organization's internal controls in preventing or detecting material misstatements in financial statements. By assessing these controls, auditors can determine the extent of their reliance on them, which influences the nature, timing, and extent of substantive testing. This process helps ensure that the financial reporting is accurate and reliable, ultimately enhancing the overall audit quality. Additionally, effective controls can reduce audit risk and potentially lower audit costs.
What are your views about the risks of fraud in the entity?
When there is no audit in place
What substantive procedure would you perform in the audit of revenue?
Mostly Analytical procedures are performed when verifying Sales / Revenue
What is audit procedures?
Audit procedure is the process followed while auditing an entity which may include:Confirm the audit assignmentComplete appropriate planningExecute actual internal audit workDevelop a report
How does the memo on test of controls in Auditing?
The audit manager
What is the second broad type of audit performed by it auditor in addition to it general control on all form of it audit project when required?
The second broad type of audit performed by IT auditors, in addition to IT general controls, is the audit of application controls. Application controls focus on specific software applications and assess the effectiveness of controls that ensure data integrity, accuracy, and security within those applications. This includes evaluating input, processing, and output controls to ensure that the software functions as intended and protects sensitive information.
What is a SAS 70 type ii audit?
A SAS 70 type ii audit is one of two service audit reports. Both reports include the service organization's description of controls, but type ii audit also has detailed testing over the controls over a minimum of 6 month period.
What is a Procedural Audit?
Procedural Audit is a means of testing whether controls are in place and are been followed. Evaluating the effectives of the design and implementation of internal controls, to detect and prevent material mis-statement.
How you do statutory audit?
A statutory audit involves a systematic examination of a company's financial statements and records by an independent auditor to ensure compliance with legal and regulatory requirements. The process typically includes planning the audit, assessing risks, evaluating internal controls, performing substantive testing, and gathering sufficient evidence to form an opinion on the financial statements. The auditor then issues an audit report, which expresses their opinion on whether the financial statements present a true and fair view of the company's financial position. Finally, the auditor communicates findings and recommendations to the management and stakeholders.
What are the two types of audit tests?
test of controls and substansive tests
What is audit period?
An audit period refers to the specific timeframe during which financial transactions and records are examined by auditors to ensure accuracy and compliance with applicable standards and regulations. This period can vary depending on the organization's reporting cycle, such as annually, quarterly, or monthly. The results of the audit typically reflect the financial position and performance of the entity during this defined timeframe. Properly defining the audit period is essential for assessing financial integrity and for making informed business decisions.
