auditing 审计.doc

Question 1 ISA 300 Planning an Audit of Financial Statements states “The auditor shall establish an overall audit strategy that sets the scope, timing and direction of the audit”. Required: Describe the factors that will be relevant to the external auditor of a listed company in setting the scope, timing and direction of a statutory audit. Suggest answer: 1. What is a plan? Written account of intended future course of action aimed at achieving specific goal(s) or objective(s) within a specific timeframe. It explains in detail what needs to be done, when, how, and by whom, and often includes best case, expected case, and worst case scenarios. This is called planning. 2. Audit strategy Auditees plan for answering the questions expected to be raised during an audit. 3. Audit strategy Scope: Legislative background Regulatory background Financial reporting framework Special reporting factors Size Risk Timing: Deadlines: statutory/imposed by company Balance of work: interim/year end/final Availability of external/internal experts Production of time budget Direction: Audit or business risk approach Risk assessment Materiality Analytical procedures Control v substantive approach Recent changes Logistics Components of an internal control system: 5 components (ISA 315): Control environment * Risk assessment process Information system relevant to financial reporting Control activities* Monitoring of controls Procedure: Time recording system. Purpose: so all employees paid only for hours worked Authorization of hours. Purpose: supervisor confirms hours worked. Hours entered to payroll independently. Purpose: segregation of duties Periodic check of hours entered to payroll Authorized list of rates of pay independent of payroll department Periodic check to payroll master files of rates of pay Fictitious employee checks ( from payroll to existence) Employees removed from payroll system.(if the employees leave the company, need to remove their name from payroll system) Knowledg