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Session 4 - What does an auditor do exactly during an audit ? - Coggle…
Session 4 - What does an auditor do exactly during an audit ?
Objectives of the interim audit
Key steps during in the interim audit
60%:
Identification of risks and internal controls
Understanding entity
Organisation of the entity
Governance (how power is organize in a company) & key stakeholders
Objectives & strategy
Performance measurement & KPI
Accounting principles the business is applying (ex: accounting rules per country)
Regulatory Environment
Legal & tax environment
Relationships with regulatory authorities
Fraud risk assessment
Mandatory assessment of the risk of fraud during a financial audit
Helps identify fraud risk factors
Identifying audit cycles
The auditor will identify and describe the key activities in the audited company that will have an impact on the IS and BS
Audit cycles
Find key internal processes and BS & IS accounts related to theses audit cycles (ex: Purchase & Suppliers; Employees (HR); Inventory; Fixed Assets)
WCGW & Audit assertions
Risk in recording & validating supplier's invoices
Make a mistake by typing wrong what is on the paper invoice (ex: one 0 less)
Miss an invoice (completeness)
False invoice (rights & obligation bc you do not owe the money)
Good not provided (Right & Obligation)
Wrong company (R&O bc is it a subsidiary that owes the money)
Classification (Presentation)
Validate supplier invoice
Payment of the supplier (risk of late payment; send payment to someone else...)
30%:
Testing internal control system
Check effectiveness of internal conrols
10%:
Final Audit Plan
Adapting
Key steps of a financial audit
