ACCG70027
External Auditing 2 |
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I: Administrative Information II: Course Details
III: Topical Outline(s) Printable Version |
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Section I: Administrative Information
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Total hours: 42.0
Credit Value: 3.0
Credit Value Notes: N/A
Effective: Winter 2014
Prerequisites:
(ACCG70026)
Corequisites:
N/A
Equivalents:
N/A
Pre/Co/Equiv Notes: N/A |
Program(s):
Accounting
Program Coordinator(s):
Multiple Coordinators
Course Leader or Contact: Multiple Course Leaders
Version: 2.0
Status: Approved (APPR)
Section I Notes:
A minimum grade of ¿B¿ (70%) in each of ACCG70026 and ACCG70027
qualify the student to apply for a partial exemption from the
Certified General Accountants of Ontario (CGA) course AU1. The CGA
challenge exam for AU1 is required.
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Section II: Course Details
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Detailed Description
Students build upon the theoretical knowledge gained in Auditing 1
by applying auditing standards and techniques. Topics include the
study and evaluation of internal control, auditing in a computerized
environment and audit sampling. The emphasis in this course is the
application of auditing concepts to audit revenues, purchases,
production, payroll, finance and investment cycle. The course ends
with the completion of the audit and the basic preparation of
working papers. Students will learn by participating in class
lectures, group discussions, weekly assignments and short reports
based on research of current topics in the media.
Prerequisite(s): ACCG70026 External Auditing 1
Program Context
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Accounting |
Program Coordinator: Multiple |
This is a valuable course
for students in the
Accounting field, offered
through the Faculty of
Continuing and Professional
Studies. Students who
successfully complete this
course with a minimum of
a ¿B¿ grade qualify for a
partial exemption from the
Certified General
Accountants of Ontario (CGA)
course AU1. The CGA
challenge exam for AU1 is
required.
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Course Critical Performance and Learning Outcomes
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Critical Performance
By the end of this course, students will have demonstrated the
ability to design tests based on audit objectives for financial
statement audits.
Learning Outcomes
To achieve the critical performance, students will have demonstrated
the ability to:
1. Explain the purpose and advantages of evaluating a client's
internal control
2. Apply the seven internal control objectives and weaknesses,
explain reasonable assurance, and cost/benefit aspects of audit
tests.
3. Compare with examples auditing around, through, and with the
computer.
4. Compare statistical vs. non-statistical (judgmental) sampling
examples for each.
5. Prepare a basic audit program for tests of controls and tests of
balances.
6. Describe the transactions, documents, confirmations, controls,
and accounts included in the sales cycle.
7. Describe transactions, documents, controls, and accounts of the
acquisition cycle.
8. Prepare audit tests of control & balances for purchases and
disbursements transactions.
9. Explain procedures for the inventory count observation and cut-
off tests.
10. Describe audit tests, transactions, documents, accounts, and
controls of the a) production cycle, b) payroll cycle, c) finance
& investment cycle.
11. Prepare analytical and detail audit tests for overall revenue and
expense accounts.
12. Explain the concepts for subsequent events, contingent
liabilities, review of working papers & discovery of errors.
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Evaluation Plan
Students demonstrate their learning in the following ways:
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Students demonstrate their learning in the following ways:
Test 1 (Chapters 9,10,11) 20%
Consists of multiple choices,
short answers, detail
descriptions/explanations
Test 2 (Chapters 12,13,14) 20%
Consists of multiple choices,
short answers, detail
descriptions/explanations
Final Exam (Comprehensive) 40 %
Consists of multiple choices,
theory questions, detail explanations
& analysis questions
Assignments working papers and reports 20 %
Total 100 %
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Section III: Topical Outline
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Some details of this outline may change as a result of circumstances such as weather cancellations, College and student activities, and class timetabling.
Effective term: Winter 2014
Professor: Multiple Professors
Textbook(s): Smieliauskas and Bewley, Auditing: An International Approach, 6th
McGraw-Hill Ryerson
Applicable student group(s): Faculty of Continuing & Professional Studies students
Course Details:Module 1 (LO# 1,2,3) Control Assessment and Testing
- Explain the auditor's need to understand the client's system of
internal control
- Understand and explain the purpose of evaluating a client's
internal control
- Describe and apply the seven internal control objectives
- Describe advantages & disadvantages of 3 methods of describing
client's system of internal control
- Identify weaknesses in internal control and audit tests of control
(compliance tests)
- Outline the auditor's responsibilities when fraud is detected
- Explain reasonable assurance and the cost/ benefit aspects of
testing internal control
- Compare with examples auditing around, threw, and with the computer
- Describe the problems of control risk assessment in a small
business
Text Reference: Chapter 9
Module 2 (LO# 4) Audit Sampling
- Distinguish audit sampling vs non-sampling work
- Compare statistical vs non-statistical (judgemental) sampling with
examples for each
- Differentiate between sampling and non-sampling risk
Text Reference: Chapter 10
Module 3 (LO# 5)Revenues, Receivables, and Receipts Process
- Prepare a basic audit program for tests of controls
- Develop a basic audit program for tests of balances
Text Reference: Chapter 11
Module 4 Review for test 1
Test 1 (Chapters 9,10,& 11) 20%
Module 5 (LO# 7,8,9) Purchases, Payables, Payments Process
- Describe the transactions, documents, controls, and accounts
included in the SAES cycle
- Outline examples of tests of control
- Design audit tests to detect errors
- Explain the importance of the "existence" objective for the
assets of the client
- Explain the importance and procedures to prepare bank and
receivables confirmations
- Design substantive audit tests for the accounts in the sales cycle
- Describe 2 common frauds involving receivables and cash accounts
- Describe transactions, documents, controls, and accounts of the
acquisition cycle
- Prepare audit tests of control for purchases and disbursements
transactions
- Design audit procedures for detecting errors and irregularities
- Explain the importance of completion objective for liabilities and
related audit tests
- Explain procedures for the inventory count observation and cut-off
tests
Text Reference: Chapter 12
Module 6 (LO# 10) Production and Payroll Processes
- Describe the transactions, documents, accounts, and controls of
the production cycle
- Outline control tests for production transactions
- Design audit tests to detect errors and irregularities in the
Production process
- Describe the transactions, controls, accounts, and documents in
the payroll cycle
- Design control tests and tests of balances for the payroll cycle
Text Reference: Chapter 13
Module 7 (LO# 10) Finance and Investment Process
- Describe transactions, controls, accounts, and documents of the
finance & investment cycle
- Design tests of control for the liabilities, equity, and
investment transactions
- Design tests to detect errors and other irregularities
- Prepare audit tests for overall revenue and expense accounts
Text Reference: Chapter 14
Module 8 Review for Test 2 Chapters 12,13,14
Test 2 (Module 5 to 8) 20%
Module 9 (LO# 12) Completing the Audit
- Describe analytical procedures for the completion of the audit
- Explain the use of various letters and reports in completing the
audit
- Explain and apply the concepts for subsequent events and
contingent liabilities
- Explain the actions required for discovery of errors after the
audit is completed
- Describe the actions for review of working papers
Text Reference: Chapter 15
Assignment is due
Module 10 Review from Chapters 9 to 15
Comprehensive Final Exam 40%
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