Premier Training

Understand the organisation’s systems and the external auditing procedures (Press the ticks on the left to mark your understanding)

Describe the accounting systems relevant to the external audit
Describe the features of an accounting system
Identify these principles of control and when they should be used:
* separation of functions
* authorisation
* recording custody
* vouching
* verification

Explain the concept of assurance and why an organisation needs to be audited

Plan an audit identifying areas to be verified and any associated risks

Identify the accounting systems under review and accurately record them on appropriate working papers

Identify the control framework

Assess risks associated with the accounting system and its controls

Record significant weaknesses in control

Identify account balances to be verified and the associated risks

Explain these different sampling techniques selecting a sample for a specific situation:
* confidence levels
* random numbers
* interval sampling
* stratified sampling

Explain tests of control and substantive procedures and their links to the audit objective

Select or devise tests in accordance with the auditing principles and agree them with the audit supervisor

Provide clear information and recommendations for the proposed audit plan for submission to the appropriate person for consideration

Describe these verification techniques and their uses:
* physical examination
* reperformance
* third party confirmation
* vouching
* documentary evidence
* identification of unusual items

Explain the auditing techniques that could be used in an IT environment

Explain how management feedback can be used when planning an audit

Conduct an audit under supervision

Explain these features of recording and evaluating systems:
* conventional symbols
* flowcharts
* internal control questionnaires (ICQs)
* checklists

Recognise the importance of audit files and working papers and their role in the audit process

Conduct tests, record test results and draw valid conclusions as specified in the audit plan

Establish the existence, completeness, ownership, valuation and description of assets and liabilities and gather appropriate evidence to support these findings

Identify all matters of an unusual nature and refer them promptly to the audit supervisor

Identify and record material and significant errors, deficiencies or other variations from standard and report them to the audit supervisor

Prepare draft reports for approval

Prepare and submit clear and concise draft reports with recommendations

Use management feedback when reporting

Agree preliminary conclusions and recommendations with the audit supervisor

Follow confidentiality and security procedures at all times

Understand auditing principles and legal and professional standards required for an external auditor

Explain the legal and ethical duties of auditors, including the content of reports and the definition of proper records

Explain the liability of auditors under contract and negligence including liability to third parties

Explain the relevant legislation and auditing standards

Explain audit risk and how it applies to external auditing

Explain materiality and how it applies to external auditing

Explain how interview and listening skills can be used by an auditor