Auditing Bits in Bytes Session 4: Assessing & Responding to Risk

Auditing Bits in Bytes(TM) is a series of eight individual sessions that guides professionals through the complete audit process from “A to Z” - starting with Pre-Engagement Planning Activities, and going all the way through Wrap-up and Quality Control. The auditing profession is undergoing the most significant changes in modern history. Think about it. The Auditing Standards Board issued 14 new Statements on Auditing Standards all effective within two years of each other, the GAO revised Government Auditing Standards (twice!) in 2007, the PCAOB has six additional Auditing Standards related to audits of SEC “issuers” that directly influenced standards established for “non-issuers”, independence rules promulgated by all relevant standard setters have been clarified and enhanced, and Statements on Quality Control Standards for firms performing attestation services have also been revamped and strengthened. Whew! That is a lot! And to think that professionals complained about being confused before all these changes occurred!?! All professionals, both those that are new to performing financial statement audits and those with previous experience, can benefit from focused training that walks participants through the complete audit process from “A to Z”, providing practical tips and best practices for ensuring an effective and efficient financial statement audit in compliance with relevant professional and regulatory standards

Objectives:

• Session 4 of this eight-part series focuses on how to appropriately identify, evaluate, document and respond to risks of material misstatement due to either fraud or error in order to effectively and efficiently design the nature, timing and extent of further audit procedures (tests of controls for operating effectiveness and substantive audit procedures).

Major Topics:

• Identifying & Evaluating Risk - How to synthesize all the information gathered throughout the risk assessment process into a concise summary of risk assessment conclusions
• Determining Significant Risks Requiring Special Audit Considerations - What differentiates this type of risk from other types of risks of material misstatement, and what that means in regards to the nature, timing and extent of further audit procedures
• Engagement Team Discussion - Common deficiencies in the performance of this required important activity
• Audit Risk Components: Inherent Risk, Control Risk, & Detection Risk - Understanding the underlying intent of each of the components, and key considerations in properly assessing and documenting the basis for conclusions
• Linking Assessed Risk of Material Misstatement to the Detailed Audit Plan - How judgment calls directly influence the effectiveness and efficiency of the detailed audit plan

Developed and offered by the Business Learning Institute.
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