CPA, AUD, chapter 1:- Engagement Acceptance and Understanding the Assignment
1 view 0 purchase
Course
CPA
Institution
CPA
It is the best notes of CPA AUD chapter 1 Engagement Acceptance and ,Understanding the Assignment I will try to upload as many as I could please support me ♥️
Certified Public Accountant (CPA)
AUDITING AND ATTESTATION
Chapter 1 :- Engagement Acceptance and Understanding the Assignment
The Engagement Acceptance and Understanding the Assignment chapter in auditing covers the initial
phase of an audit, which involves the auditor’s decision to accept the engagement and understanding
the client’s business and industry. The following are the key points covered in this chapter:
Engagement Acceptance: Before accepting an audit engagement, the auditor should consider various
factors, such as the client’s reputation, management’s integrity, the auditor’s independence, the
scope of the engagement, and the auditor’s expertise. The auditor should also assess the risks
involved in the engagement and determine whether the audit team has the necessary resources to
perform the engagement effectively.
Understanding the Client’s Business and Industry: The auditor should obtain a thorough
understanding of the client’s business and industry to plan the audit effectively. This includes
understanding the client’s operations, industry trends, regulatory environment, and internal control
system. The auditor should also assess the client’s business risk, including the risk of fraud, and
determine the scope and nature of audit procedures required to address the identified risks.
Written Audit Engagement Letter: Once the auditor has accepted the engagement and understood the
client’s business and industry, the auditor should prepare a written audit engagement letter to
document the terms of the engagement. The letter should include the objectives and scope of the
engagement, the auditor’s responsibilities, management’s responsibilities, and the expected
deliverables. The letter should also document any limitations of the engagement.
Preliminary Analytical Procedures: The auditor should perform preliminary analytical procedures to
identify any unusual transactions or relationships that may indicate a risk of material misstatement.
The auditor should also compare the client’s financial statements to prior periods and industry
benchmarks to identify any significant fluctuations or anomalies.
Overall, the Engagement Acceptance and Understanding the Assignment chapter in auditing
emphasizes the importance of planning and preparation in conducting an effective and efficient audit
engagement. The chapter highlights the need for the auditor to exercise professional judgment, assess
risks, and communicate effectively with the client to ensure a successful engagement.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller shivrajchavan. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $10.49. You're not tied to anything after your purchase.
