Note Title 57/2016 J Changes with effect fam Lp 1b wan, rT, Eyam fev react a Newly added gy llabus = Sh rae beirelPay Concho | 3 New Tsh =» TSA Tol ~» aff acting onal report+ Two sections: GeetionlA and Section|BY 20 + Section A > total = Yfnarks Oo + Three(3) questions referred to as Objective Test (OT) cases. + Each question will contain a single scenario against which five objective test items worth two marks each will be set, therefore each OT case is worth 10 marks. [© mea xv 2 = 20 woes Planning Testing | Review and ___ finalisation 1. Obtain an understanding of entity 2. Ascertain and document internal controls Ie 3. Audit risk assessment |D +o !S neves 4. Analytical procedures oe 5. Determine materiality 6. Timing of audit: interim audit and final audit 7. Reliance on experts and internal auditor 8. Audit strategy and Audit Plan 12 VT nods #* moe . Sudstantive procedures . Internal controls and Test of Controls 1. Subsequent event 7 io marks %*2. Going concern 3. Additional audit procedures 4. Management representation| Reporting #1. Audit report 2. Management letter a ew Andb Bese lo +o Ix Ne 2 + /7 subsguink wert [Sang conten 10 Ani rape yt Onis w Corpora. Goirente. {0 _ SY Te Meelimited liability companies — privete Cin ited, — public lietad Shareholders Directors are accountable to shareholders ia ir nown as external auditor whose FS are eing audited as required by Companies Act> Managed by directors Who are responsible t Prepare FS that are True & Fair (T&F) Audit report & opinion on FS Accounting Firm “Audit service ‘Tax service + Accounting service *Insolvency service +Others Audit Team: Audit partner @— Audit manager Audit supervisor Audit senior Audit assistant or statutory auditor (engagement letter) Carry out audit or Fs: +SCI “SFP “SCF “SCE Notes alto kwown as external omdiF4 [0D Jo sore = Absolutly aceurance Matin — ascurance 9%, swe =? Res enstle assurance, oor Sure a 07, see = No assurance 9252010 020, Explain the concept of MRUEV@NGIFAIRIpresentation. (4 marks) C2) Cry TRUE - FACTUAL awe ly wih MA hls The - not biased - vol le ah substance ] a tue tvanseteryYee det HCO p 87 3) An auditor of a company is entitled to: Chevaloldort Aeuting | = ot ahr ——— 1) attend anyigeneralimeeting ofthe company otreetters anativg 2) receive all notices of, and other communications relating to, any general meeting which a member is entitled to receive, 3) be heard at any general meeting which he attends on any part of the _ business of the meeting which concerns the auditor in his capacity as oo auditor. 2 Rights © Access to ala reavals ® Ask fv inf wrnechin’ fore planation: ® Onavd geneva! nauirting aad A heard~ NOH an a— * cove! Companies Act - Appointment of Auditor deen ust need clerhsdre The first auditor TS appointed by the directors. The appointment i$ Valid until the completion of the first annual general meeting. Subsequently, in each annual general meeting, directors willffominateyhe auditor to be appointed and shareholders will vote and approve the audit appointment. Conflict Between ISA and local auditing standards (e.g. Singapore Standards on Auditing SSA) — Ondedays foie wr Local Rtandords Dec 2010 Q2b - Explain the status of International Standards on Auditing. (2 marks) [- Puditovs must fone Ae of the TA beh cand wating an and 2, si andibvs Ceniidoy th necessary to depart cf Th, anders rowed hove geod Jett rahe « Jim life MLauU pit4 Which of the following statements, relating to International Standards on Auditing (ISAs), if any, is/are correct? (1) Intemational Standards on Auditing (ISAs) are issued by the InemaionaGcountnd)pandards Board (IASB) and provide guidance on the performance and conduct of an audit lA ASB (2) In the event that ISAs differ from local legislation in a specific country, auditors must comply with the requirements of the ISAs lonly a 2 only Both 1 and 2 Neither 1 nor 2 v,omF (2 marks) Clo Pp be Qo1Q Nay py MO2S ps] 5 Which TWO of the following are fundamental principles as stated in the ACCA’s Code of Ethics and Conduct? 1 hic 2 nBpe I wtagrety 3 Confidentiality ; 4. Professinseteicism preforerms behaviour A land4 B land2 C 2and3 D land3 V (2 marks)« An auditor nal in the United Kingdom who believes that a client has committed cronretist offences, or has reasonable cause to believe that a client has committed treason, is bound to disclose that knowledge to the proper authorities immediately = Mandotory [toswte Aicence to ard CR! Kam * If.an auditor forms a suspicion of money laundering in the course of their professional activities, they shall report it to a proper authority. « An auditor shall disclase information if compelled by the process of law, for example under Court rap) Voluntary disclosure a Con chance, salar fo dite In certain cases an auditor is free to disclose information, whoever its 4s hott These circumstances fall into four categories of disclosure: oat (a) in the publielinterest; _____ (b) to protect an auditorstinterests - e.g. defend amnegligenceslawisuit; (c) authorised bysstatute; (d) to nonegovernmentahbodies. 23. chair ; Dec 2011 Q4c - 5 marks OD Explain the auditor's ethical responsibilities with regard to client confi identiality ann they have a responsibility to “ client information. | c Ca) Respect clint’ Aarvttal internation ee ust aw +o re - Y oT Gee fv porrmal aclvantage ov kd party's advourape - (Cb) Awdibey met diseloge Lient ¢ Crm dlrIn}o/naloen whn it ts abhgatory : ® clits aca tavolvid iw lowrenet oth iteo 1) Clinds mov hava cmamitied reason (Qdots nny be veld om hart Coun daring « (4) tohen thee uc a Court wie.For which TWO of the following situations should an auditor make ae bls If an auditor knows or suspects his client is engaged in money laufidering here disclosure is made to non-governmental bodies a here it is in the public interest to disclose (4) If an auditor suspects his client has committed terrorist offences Aland obligatory Bland3 © 2and4 Y D2and3 (2marks)Memmse the rome + the three Five Ethical Threats do net nad to menante Abinto _____ Ethical threats are circumstances which prevent auditors from complying with the fundamental principles. The IFAC Code describes five ethical threats: - onal cwlerect _a) Self-interest threat - the threat that a financial or other interest will — inappropriately influence the auditor’s judgment or behaviour; abyective ___b) Self-review threat - the threat that an auditor will not appropriately a evaluate the results of a previous judgment made or service performed by the auditor, or by another individual within the audit firm, on which the auditor will rely when forming a judgment as part of providing acurrent > service; Aw oditin lin Onn wet ond nowy wer lark any en __|¢) Advocacy threat - the threat that an auditor will promote a client's position ~ to the point that the auditor’s objectivity is compromised; : erg! the Clon Soy Jrod HS showt ake Client ~~) Familiarity threat - the threat that due toa long or close relationship with - accent, an auditor will be too sympathetic to their interests or too accepting — | oftheir work; and Andi becomse (ass steigert =) owditw dows NOT roars prof eure Skepti cits) Intimidation threat - the threat that an auditor will be deterred from acting | objectively because ofctualpr perceived pressures, including attempts to | exercise undue influence over the auditor. - 2) Undue dependence on total fees fromaclient; A van large ond — Clenet 43. Enron _ pail Arthur Anderton 4 LD ws onde fans eA coulting fatsAiwdity owninp Shaves ii an audit chevef Jun Pol Q@UC p/3 i [. Tdemtity = cory few hk eave. I ) (4) The perth Son veill receive Chevae in Graf tr ha inl ae poles Ananage™ C7 Ths Rill give se to Self iveteceet threat, Galen becouse tht Tanmradrae fartly punt cleves TBs tS rhe Same at if the perhey aun thersa. The por her hoo Vatted twlerat in tt FS. Radu rhe rh reart Assigs onorer ana porter to he OS| Ea when an audit frm has a In this case as holding snares i prohibited by ACCA’ Code ~ financiafiniresin the company. In this case the parne’s of Ethics and Conduct then ethe he son should reuse the ~~ son il aceive shares as part of his remuneration. Aste shares or re Ikly te engagement partner wil need fo. ~ sons an immediate family member ofthe partner then if he. be removed fom ihe audit a folds the shares itl be as ifthe partna hls these a hates, and this is probe. _