ACCG70013
Auditing 2
 
  I: Administrative Information   II: Course Details   III: Topical Outline(s)  Printable Version   Public
 
Section I: Administrative Information
  Credit Value: 3.5
Credit Value Notes: N/A
Effective: Spring/Summer 2016
Prerequisites: (ACCG70012)
Corequisites: N/A
Equivalents:
N/A
Pre/Co/Equiv Notes: N/A

Course Name (short): Auditing 2
School:
Continuing Ed & Corp Training
Program(s): N/A
Program Coordinator(s): N/A
Course Leader or Contact: Multiple Course Leaders
Originator: Michelle McLaren
Designate: Michelle McLaren
Version:
3.0
Status: Approved (APPR)

Calendar Description
This is a continuation of Auditing 1 Distance Learning and begins with an in depth study of internal controls. Apply the concepts of Auditing 1 to the audit of sales, acquisitions, payroll, inventory and cash balances and related income statement and balance sheet accounts. Learn the appropriate audit procedures and audit objectives for tests of control and tests of details of balances.

Typical Instructional Format

Distance Education
48.0
Total hours: 48.0

Courses may be offered in other formats.

Section I Notes: This course is delivered through OntarioLearn and is hosted by Durham College. Access to this course is through OntarioLearn website.

 
 
Section II: Course Details

Detailed Description
This course is a continuation of Auditing I and begins with an in-depth study of internal controls. It then applies the concepts of Auditing I to the audit of sales, acquisitions, payroll, inventory and cash balances and related income statement and balance sheet accounts. Students will learn the appropriate audit procedures and audit objectives for tests of controls and tests of details of balances.

Program Context

  N/A

Course Critical Performance and Learning Outcomes

 
 
LEARNING OUTCOMES:

To achieve the critical performance, students will have demonstrated 
the ability to:

1. Appraise an entity's internal control and assess and document the
level of control risk and detection risk.

2. Evaluate the audit findings and reach a final conclusion on
accounts receivable and revenue related accounts; accounts payable and
accrued expenses; payroll expense and payroll related accrued
expenses; inventory and related accounts and cash accounts.  

3. Assess the audit issues related to contingent liabilities,
commitments, and subsequent events.

4. Prepare, understand and use audit working papers to document work
completed during the audit.

5. Understand how to finalize an audit, including evaluation and
communication of findings. 

6. Take responsibility for one's own actions, decisions, and
consequences and understand the increasing importance of critical
thinking and ethical decision making in professional judgment.

7. Manage the use of time and other resources to complete assigned 
tasks.

8. Locate, select, organize, and document information using
appropriate methods necessary under the circumstances.

9. Be able to communicate clearly and correctly in the written and
spoken form that fulfills the purpose and meets the needs of the 
audience.

Evaluation Plan
Students demonstrate their learning in the following ways:

 
Assignments (3): 30%
Participation Discussion: 10%
Midterm: 20%
Final Exam: 40%

CGA Equivalent This course combines with Auditing I to give the
student a credit in the CGA program providing at least a B (70+)
standing is achieved.
Provincial Context
The course meets the following Ministry of Training, Colleges and Universities requirements:

 

Essential Employability Skills
Essential Employability Skills emphasized in the course:

X Communication X Critical Thinking & Problem Solving   Interpersonal
X Numeracy   Information Management   Personal

Notes: N/A

Prior Learning Assessment and Recognition
PLAR Contact: Multiple PLA Contacts

Students may apply to receive credit by demonstrating achievement of the course learning outcomes through previous life and work experiences. This course is eligible for challenge through the following method(s):

Challenge Exam Portfolio Interview Other Not Eligible for PLAR
         

Notes: N/A

 
 
Section III: Topical Outline
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: Spring/Summer 2016
Professor: Multiple Professors
Textbook(s):
Auditing: An International Approach
6th edition
Smieliauskas, Bewley
McGraw-Hill Ryerson
ISBN: 978125-906-6535

No substitute(s) unless otherwise stated.

Applicable student group(s): All
Course Details:
Internal Control in a Financial Statement Audit

- Understand the importance of internal control to management and
auditors
- Identify the components of internal control.
- Learn how to plan an audit strategy.
- Learn how to develop an understanding of an entity's internal 
control.
- Identify the tools available for documenting the understanding of
internal control.
- Learn the types of tests of controls.
- Know how to assess and document the level of control risk.
- Understand audit strategies for the nature, timing, and extent of
substantive tests based on different levels of detection risk.
- Understand the considerations for the timing of audit procedures.
Learn about the auditor's communication of internal control-related
matters.

Auditing the Revenue Process

- Understand why knowledge of an entity¿s revenue recognition
policies is important to the audit.
- Understand the revenue cycle.
- Identify the types of transactions in the revenue cycle and the
financial statement accounts affected.
- Identify and describe the types of documents and records used in
the revenue cycle.
- Understand the functions in the revenue cycle.
- Know the appropriate segregation of duties for the revenue cycle.
- Identify and evaluate inherent risks relevant to the revenue cycle
and related accounts.
- Assess control risk for a revenue cycle.
- Identify key internal controls and develop relevant tests of
controls for revenue, cash receipts, and sales returns transactions.
- Relate the assessment of control risk to substantive testing.
- Identify substantive tests of transactions and analytical
procedures used to audit accounts receivable and revenue-related 
accounts.
- Identify tests of account balances used to audit accounts
receivable and revenue related accounts.
- Describe the confirmation process and how confirmations are used to
obtain evidence about accounts receivable.

Auditing the Purchasing Process

- Understand why knowledge of an entity¿s expense and liability
recognition policies are important to the audit.
- Develop an understanding of the purchasing cycle.
- Identify the types of transactions in the purchasing cycle and the
financial statement accounts affected.
- Identify and describe the types of documents and records used in
the purchasing cycle.
- Understand the functions in the purchasing cycle.
- Know the appropriate segregation of duties for the purchasing cycle.
- Identify and evaluate inherent risks relevant to the purchasing
cycle and related accounts
- Assess control risk for a purchasing cycle.
- Identify key internal controls, and develop tests of controls for
purchasing, cash disbursements, and purchase return transactions.
- Relate the assessment of control risk to substantive testing.
- Identify substantive tests of transactions used to audit accounts
payable and accrued expenses.
- Identify analytical procedures used to audit accounts payable and
accrued expenses.
- Identify tests of account balances used to audit accounts payable
and accrued expenses.
- Describe how confirmations are used to obtain evidence about
accounts payable.

Auditing the Human Resource Management Payroll Process

- Develop an understanding of the payroll cycle.
- Identify the types of transactions in the payroll cycle and the
financial statement accounts affected.
- Identify and describe the types of documents and records used in
the payroll cycle.
- Understand the functions in the payroll cycle.
- Know the appropriate segregation of duties for the payroll cycle.
- Identify and evaluate inherent risks relevant to the payroll cycle
and related accounts.
- Assess control risk for a payroll cycle.
- Identify key internal controls and develop relevant tests of
controls for payroll transactions.
- Relate the assessment of control risk to substantive testing.
- Identify substantive tests of transactions used to audit payroll
expense and payroll related accrued expenses.
- Identify analytical procedures used to audit payroll expense and
payroll related accrued expenses.
- Identify tests of account balances and payroll related accrued
expenses.

Auditing the Inventory Management Process

- Develop an understanding of the inventory cycle.
- Identify and describe the types of documents and records used in
the inventory cycle.
- Understand the functions in the inventory cycle.
- Know the appropriate segregation of duties for the inventory cycle.
- Identify and evaluate inherent risks relevant to the inventory
cycle and related accounts.
- Assess control risk for an inventory cycle.
- Identify key internal controls and develop relevant tests of
controls for inventory transactions.
- Relate the assessment of control risk to substantive testing.
- Identify substantive tests of transactions used to audit inventory
and related accounts.
- Identify analytical procedures used to audit inventory and related
accounts.
- Know how to observe physical inventory.
- Identify tests of account balances used to audit inventory and
related accounts.

Auditing Cash and Short-term Investments

- Understand the relationship of the various accounting cycles to 
cash.
- Know the different types of bank accounts.
- Identify substantive tests of transactions used to audit cash.
- Identify tests of account balances used to audit cash.
- Know how to audit bank reconciliation.
- Understand fraud related audit procedures for cash.

Completing the Engagement

- Understand the audit issues related to contingent liabilities.
- Know the audit procedures used to identify contingent liabilities.
- Understand the audit issues related to an enquiry letter.
- Understand why the auditor must be concerned with commitments.
- Know the types of subsequent events.
- Understand the effect of subsequent events on the dating of the
audit report.
- Know the audit procedures used to identify subsequent events.
- Know the audit steps to be taken when finalizing the audit.
- Understand the auditor¿s communication with the audit committee and
management and the matters that should be addressed.
- Know the auditor¿s responsibility for subsequent discovery of facts
existing at the date of the auditor¿s report.


Academic Honesty
The principle of academic honesty requires that all work submitted for evaluation and course credit be the original, unassisted work of the student. Cheating or plagiarism including borrowing, copying, purchasing or collaborating on work, except for group projects arranged and approved by the faculty member, or otherwise submitting work that is not the student's own violates this principle and will not be tolerated. Instances of academic dishonesty, including assisting another student to cheat, will be penalized as detailed in the Student Handbook.

Students who have any questions regarding whether or not specific circumstances involve a breach of academic honesty are advised to discuss them with the faculty member prior to submitting the assignment in question.

Discrimination and Harassment
Sheridan is committed to provide a learning environment that respects the dignity, self esteem and fair treatment of every person engaged in the learning process. Behaviour which is inconsistent with this principle will not be tolerated. Details of Sheridan's policy on Harassment and Discrimination are available in the Student Handbook.
 
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