Audit Staff Training for New Senior Accountants—Part 5, Modifying Audit Tests of Balances Programs: The Keys to Quality and Efficiency


CPE Credit: 2 hours

These materials are based on the learning in previous parts of this series of webinars. Audit planning, risk assessment procedures, internal control and audit strategies are the foundation for audit program modification. This part will explore further the purposes and uses of analytical procedures, the nature extent and timing of tests of balances and how to effectively link risk assessment with audit responses and procedures in the audit program (plan). The audit program modification process may be the responsibility of the engagement in-charge accountant or the engagement leader depending on firm policy. In any event, the in-charge accountant should be aware of the results of the risk assessment process on an engagement before performing or assigning tests of balances procedures. This section begins with a summary of AU-C Section requirements. 

LEARNING OBJECTIVES
• Understand Clarified Auditing Standards requirements for obtaining audit evidence, including cost-beneficial audit strategies.
• Be able to use assessed levels of risk of material misstatement in financial statement classifications to guide audit program modification.
• Understand how to use analytical procedures to evaluate the appropriateness and reasonableness of financial statement classifications and assertions.
• Learn how to plan the most cost-efficient combination of analytical and tests of balances procedures based on assessed levels of risk.
• Know how to modify a one-size-fits-all tests of balances audit program (plan) that will result in an effective and efficient audit.