My Skill Lab
AccountingIntermediate

Auditing Fundamentals

Risk, evidence, controls testing and the audit opinion.

Taught by Pooja Adhikari · Chartered Accountant

What you'll learn

  • Explain the objective of an audit, the levels of assurance and the expectation gap
  • Apply ethical and independence requirements and prepare an engagement plan under ISA 210 and ISA 300
  • Set overall and performance materiality and assess risks of material misstatement using ISA 315
  • Link financial statement assertions to audit procedures and rank the reliability of evidence
  • Design tests of controls, select and evaluate samples under ISA 330 and ISA 530
  • Complete the audit, evaluate misstatements and draft an unmodified or modified auditor's report

About this course

Auditing is the discipline that gives financial statements their credibility, and it is the entry point to Big Four and mid-tier careers as well as a core paper in every professional qualification, including the CPA AUD section and ACCA Audit and Assurance. This course is for graduates, trainee auditors and accountants moving into assurance who want to understand the audit cycle end to end. You will learn how an audit is planned, how materiality and risk shape the work, how assertions link to procedures and evidence, how controls are tested and samples selected, how working papers are documented, and how the auditor's report is formed under the International Standards on Auditing (ISAs). Prerequisites: a working knowledge of double entry and financial statements. By the end you will be able to plan and execute audit work on a typical balance and explain exactly what the opinion means.

Course content

7 lessons
  1. 1What an Audit Is and the Audit CycleThe objective of an audit, reasonable assurance, the expectation gap and the stages of every engagement.Preview
  2. 2Ethics, Acceptance and PlanningThe fundamental principles, threats to independence, the engagement letter and the overall audit strategy.
  3. 3Materiality and Risk AssessmentSet overall and performance materiality, apply the audit risk model and identify significant risks under ISA 315.
  4. 4Assertions, Evidence and Substantive ProceduresMap assertions to procedures, rank evidence by reliability and build a substantive programme for a balance.
  5. 5Internal Control and Tests of ControlsThe components of internal control, walkthroughs, designing tests of controls and reporting deficiencies.
  6. 6Sampling, Analytical Procedures and DocumentationChoose and evaluate samples under ISA 530, use analytical procedures as evidence and keep working papers to ISA 230.
  7. 7Completion and the Auditor's ReportEvaluate misstatements, subsequent events, going concern and representations, then form and word the opinion.