Audit and Assurance
  I: Administrative Information   II: Course Details   III: Topical Outline(s)  Printable Version
Section I: Administrative Information
  Total hours: 56.0
Credit Value: 4.0
Credit Value Notes: N/A
Effective: Fall 2020
Prerequisites: ACCG59106
Corequisites: N/A
Equivalents: N/A
Pre/Co/Equiv Notes: N/A

Program(s): Professional Accounting Grad
Program Coordinator(s): Lorraine Alyea
Course Leader or Contact: Ernie Kerst
Version: 20200914_00
Status: Approved (APPR)

Section I Notes: Allowable calculator: Texas Instruments BAII Plus.

Section II: Course Details

Detailed Description
Students develop a solid understanding of the principles and procedures of external auditing. Topics include reporting, professional standards, ethics, legal liability, audit objectives, evidence and documentation, planning and analysis, materiality and risk, internal control, audit sampling, and computer auditing. Students learn through interactive lectures, case studies and classroom activities.

Program Context

Professional Accounting Grad Program Coordinator(s): Lorraine Alyea
This course is a required course in the Professional Accounting Ontario College Graduate Certificate.

Course Critical Performance and Learning Outcomes

  Critical Performance:
By the end of this course students will have demonstrated the ability to report the results of an assurance audit for different organization types, identifying various components and associated risks.
Learning Outcomes:

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

  1. Differentiate between the various types of audits, auditors, and reasons for each audit.
  2. Explain the rules of professional ethics and legal liability for the accounting/auditing profession.
  3. Apply generally accepted auditing standards to the planning of an audit.
  4. Analyze materiality to determine the amounts and types of errors that would constitute a substantial error when reporting financial results.
  5. Analyze the internal controls of a company.
  6. Test the feasibility of financial statement balances through financial statement analysis.
  7. Prepare an audit program to test a company's system of internal controls and balances.
  8. Describe the transactions, documents, confirmations, controls and accounts included in the sales, acquisitions and disbursements, production, payroll, finance and investment cycles.
  9. Select accounts for substantive testing and evidence collection.
  10. Evaluate the sufficiency and appropriateness of audit evidence.

Evaluation Plan
Students demonstrate their learning in the following ways:

 Assignments/Reports (2x10%)20.0%
 Case Study20.0%
 Comprehensive Final Exam35.0%

Evaluation Notes and Academic Missed Work Procedure:
In addition to achieving a minimum 50% overall grade, a student must achieve a grade of at least 50% on the final comprehensive exam in order to receive credit for this course.

Provincial Context
The course meets the following Ministry of Colleges and Universities requirements:


Prior Learning Assessment and Recognition
PLAR Contact (if course is PLAR-eligible) - Office of the Registrar

  • Not Eligible for PLAR

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.
Instruction Mode: In-class & Online Instruction
Professor: N/A
RequiredTextbookAuditing: An International Approach, Smieliauskas, W. J., & Bewley, K, McGrawHill Ryerson, 8th edition, 2019
RequiredOtherCPA Canada Handbook: Canadian Auditing Standards (CAS) - CPA Canada
RequiredOtherRules of Professional Conduct (RPC) - CPA Ontario

Applicable student group(s): Professional Accounting Ontario College Graduate Certificate
Course Details:

Module 1:  Basic Concepts of Assurance

1.      Basic Concepts

  • Assurance engagements
  • The economic purpose of an audit
  • The role of the auditor
  • The expectations gap

2.      Auditing Standards and Regulations

  • Canadian standards
  • International auditing standards
  • Canadian regulations
  • Implications of increased regulation for assurance engagements

3.      Rules of Professional Conduct, Ethical Standards and Legal Considerations

  • Rules of professional conduct
  • Ethical standards
  • Legal considerations

Learning Outcomes: 1, 2


Module 2: Acceptance and Continuance

1.      Accepting the Engagement

  • Obtaining an audit engagement
  • Acceptance risks
  • Acceptance/continuance procedures
  • Continuance
  • Independence-threat responses
  • Engagement letters

2.      Planning the Engagement

  • The purpose of planning
  • Audit risk
  • Potential areas of misstatement
  • Obtaining an understanding of the entity and its environment
  • Risk-assessment techniques
  • Developing a response to assessed risks
  • Documentation
  • Communication

3.      Planning – Specific Matters to Consider

  • Going concern
  • Fraud
  • Laws and regulations
  • Related parties
  • Service organizations
  • Using the work of an expert
  • Using the work of internal audit

Learning Outcomes: 2, 3


Module 3 – Introduction to Internal Controls

1.      Internal Controls

  • Control activities
  • Common controls for transactions

2.      Information Systems

  • Overview
  • Information systems controls
  • General controls
  • Application controls

3.      Control Frameworks
4.      Accounting System and Control Procedures

  • Components of internal control
  • Key internal controls
  • Understanding systems
  • Practical examples of accounting systems
  • Assessing controls

5.      Payroll and Inventory Tests of Control

  • IT considerations
  • Computer-assisted audit techniques
  • Implications on remaining audit approach

Learning Outcomes: 5, 7, 8
Assessments: Research Report (10%)

Midterm Exam – 25%


Module 4 – Audit Procedures

1.      Introduction to Audit Procedures

  • Audit evidence
  • Selecting items for testing
  • Substantive analytical procedures
  • Preparing for year-end fieldwork

2.      Substantive Testing

  • Developing substantive procedures
  • Common balance sheet accounts
  • Common income statement accounts
  • Estimates
  • Complex accounting requirements
  • Other accounts for testing

Learning Outcomes: 4, 5, 6, 7, 9, 10


Module 5 – Completing the Audit

1.      Audit Completion

  • Documentation
  • Completion procedures
  • Evaluation of audit evidence
  • Management representations
  • Communicating with management and those charged with governance
  • Internal completion documents
  • Quality control over the audit engagement
  • Reporting

2.      Group Audits

  • Auditing consolidated financial statements
  • Responsibility
  • Group audit stages
  • The audit report

Learning Outcomes: 5, 6, 7, 10
Assessments: Research Report (10%)


Module 6 – Other Types of Engagements
1. Other Types of Engagements

  • Key process stages
  • Acceptance and continuance
  • Planning and risk assessment
  • Collection of evidence
  • Completion and reporting
  • Types of engagements
  • Comparing assurance and non-assurance engagements

Learning Outcomes: 1, 2
Assessments: Case Study (20%)

Final Exam (Comprehensive) – 35%

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Academic Integrity: The principle of academic integrity 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 professor, or otherwise submitting work that is not the student's own, violates this principle and will not be tolerated. Students who have any questions regarding whether or not specific circumstances involve a breach of academic integrity are advised to review the Academic Integrity Policy and procedure and/or discuss them with the professor.

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