Audit Evidence Presentation

Presented by; SHUAIB ADEADEBAYO HND, B.
sc, ACCA
adeadebayo
5/26/2012
what is an audit?
definition of audit evidence how to generate reliable audit evidence

auditing standards and quality control quality audit work auditors right to generate audit evidence
how much audit evidence degree of audit evidence sources of audit evidence the use of assertions audit documentation
adeadebayo
5/26/2012
adeadebayo
5/26/2012
Audit evidence is the fact obtain by an auditor during the course of audit to formulate audit report
adeadebayo
5/26/2012
According to ISA (international Auditing Standard )500: it says that an auditor must generate Sufficient appropriate audit evidence to be able to draw reasonable conclusions on which to base an audit opinion
adeadebayo 5/26/2012
Auditing standards
Quality control Quality audit work
adeadebayo
5/26/2012
Recognized
Statutory Body For example ACCA, National Standards In UK, set by Auditing Practices Board, ICAN(Nigeria) International Standards on Auditing Set by International Auditing and Assurance Standards (ISAs) Board (IAASB) part of the International Federation of Accounting Committee (IFAC)
Education and work experience Eligibility, such as membership of a supervisory body Supervision and monitoring
adeadebayo
5/26/2012
According to ISA 200 (international Auditing standard) Auditors are to; planned and performed the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. .in our opinion the financial statements show a true and fair view. No guarantees Not every error discovered Not certifying accuracy
Access to records Information and explanations Attendance at and notice about general meetings Right to speak at general meetings on relevant matters Rights to receive proposed resolutions Right to resign before audit completion Right to have information circulated to the shareholders
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Typical duties: To issue an audit report, giving opinions on: truth and fairness of the Financial Statements whether the Financial Statements are properly prepared any other opinions required. When leaving a client, to issue a Statement of Circumstances After resignation, to supply information to the new auditors.
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ISA500: Sufficient appropriate audit evidence to be able to draw reasonable conclusions on which to base an audit opinion. Sufficient = quantity Appropriate = relevant and reliability
External better than entitys records Auditor-direct obtained better than indirect evidence Entity better if a good internal control system Written better than oral Originals better than photocopies
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Internal vs External Written vs Oral Evidence Obtain vs Evidence Given Current Evidence vs Past Evidence
adeadebayo
5/26/2012
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Analytical Procedures
Enquiry and confirmation
Inspection
Observation
recalculation and re performance
adeadebayo
5/26/2012
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Use
of assertion Use of the work of an Expert Use of third party evidence Use of Audit working paper and documentation
adeadebayo
5/26/2012
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Accuracy Completeness Cut off Allocation Classification and understandability Occurrence Valuation Existence Rights & obligations (ownership) (ACCA COVER)
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Transactions and events
Account balances
Presentation and disclosure
adeadebayo
5/26/2012
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If it relates to a transaction, then verify (controls and substantive evidence) the assertions of:
Occurrence Completeness Accuracy Cutoff Classification
adeadebayo
5/26/2012
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If it relates to a year end balance then verify (controls and substantive tests) the assertions of:
Existence Rights and obligations Completeness Valuation Allocation
adeadebayo
5/26/2012
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If it relates to the presentation and disclosure in the FS:

Occurrence Rights and obligations Completeness Classification and understandability Accuracy Valuation
adeadebayo
5/26/2012
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Experts (eg estate agents, actuaries, lawyers) Internal auditors External auditors
Before reliance can be placed on the work of an expert, internal auditor e.t.c they must be:
Qualified Experienced Independent Professional

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Should agree the following in writing: Nature, scope and objectives of work Respective responsibilities Nature, scope and timing of communications That the expert observes confidentiality Auditor must examine the experts work with respect to: Consistency with other evidence Assumptions made Use and accuracy of source data.
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It is essential that the entire audit process is documented to: Document show that the audit work has been done properly Enable senior staff to review the work of junior staff Help the audit team in future years Encourage a methodical, high-quality approach. Working papers will be retained for some years (at least 7) for safety and reference
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THANK YOU AND GOD BLESS
SHUAIB ADEADEBAYO
HND, B.sc, ACCA adeadebayo1751@yahoo.com
adeadebayo
5/26/2012
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Presented by; SHUAIB ADEADEBAYO HND, B.

definition of audit evidence how to generate reliable audit evidence

Enquiry and confirmation

recalculation and re performance

Transactions and events

Presentation and disclosure

If it relates to the presentation and disclosure in the FS:

Qualified Experienced Independent Professional

THANK YOU AND GOD BLESS

HND, B.sc, ACCA adeadebayo1751@yahoo.com

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