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assesing the risks of material misstatement - Coggle Diagram
assesing the risks of material misstatement
process
1 .identify risks throughout the process od obtaining an understanding of the entity and its enviroment
assess the identified risks and evaluate whether they related more pervasively
related the risks what can go wrong at the assertion level ( cap do co so du lieu)
consider the likelihoodof the risks causing a material misstatement
new words
pervasively: tran lan
respond: phan hoi
Where
Financial Statement Level
Assertion Level : classes of transactions, account balances, and disclosures
FACTORS
The risk of fraud
Relationship with econimic, accounting and other developments
Degree and subjectivity
unusual transactions
significant transaction with related party
Complexity of transaction
RESPONDING TO THE RISK ASSESSMENT
Obtain sufficient audit evidence
overall responses
audit team: emphasising professional scepticism, more staff, using expert or providing more supervisor
assertion level
test of control ( thu nghiem kiem soat)
evaluate operating effectiveness of CONTROL
re-performance
inquiry
observation
inspection
substantive procedures ( thu nghiem co ban)
test of detail
invoice
documents
assets
sbstantive analytical procedures
for large volumes of predictable transasction: wages and salaries