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Hello Sir,
My question is related to the approach to be followed while answering risk based questions.I m using Kaplan study text .On page no 203 an approach is given on how to solve questions related to risk assessment.
In the same chapter ,test your understanding 1(page 206) the question asks two things .
1st part becomes very easy to solve on the basis of approach specified on page 203 .However I m facing difficulty with respect to the second part i.e the audit procedures to be performed.
Procedures are very open ended, is their any way to tackle such type of questions with ease?I do not have the text you are referring to and even if I had I could not comment on their approach. As it states here https://opentuition.com/forum/ask-acca-tutor-forums – these forums are provided to support students studying with OpenTuition notes.
I suggest you take a look at the relatively new articles written by a member of the AAA examining team https://www.accaglobal.com/ca/en/student/exam-support-resources/professional-exams-study-resources/p7/technical-articles.html – part 2 concerns risk and part 4 audit procedures.
Thankyou Sir .for your reply…sorry actually i saw a question related to the kaplan that’s why I asked .
Thanks for the helpIt’s not a problem to reply to posts about questions and answers in the revision kits of the Approved Content Providers as these are generally past exam questions. I can also comment on examiner’s approach, etc as set out in ACCA resources. These and of course all OpenTuition’s resources are the things I have ready access to.
Thanks for being so helpful sir,it means a lot . Actually i use opentution notes as study text and then refer question from the Kaplan Kit as mentioned on the face of opentution notes.
Actually one of the problem i m facing in risk based question is the audit procedures to be applied .
In that particular question no calculations were provided , was just a theoretical case based question on inventory and debtor and the requirement was to write the audit procedure regarding the same.I was able to identify the risk , what should be the appropriate accounting treatment , the impact it can have on the financial statement but was not able to write the audit procedure part .
Is there some technique ( a general one ) that can provide me some framework within which i can think as the audit procedures in general are open ended and a whole essay can be written on it.Can you please provide an example of a question you are struggling with. Mostly in AAA the requirements for audit procedures are along the lines of “Design the principal audit procedures to be used in the audit of [class or transactions/event/account balance].”
This tends to be only 5/6 marks for any one thing and the requirement might give a specific assertion to address – like valuation.
So it won’t be open ended and you shouldn’t be able to write a whole essay on it. You’re looking for 5/6 sentences to make points about PRINCIPAL audit procedures.
Things to consider when deciding what these are:
> Which assertions are most at risk (if not specified) – is it completeness? existence? cut-off? etc
> Where are you in the audit? If you’re planning the year end, does it make sense to suggest tests of control?
> Can you think of a relevant analytical procedure that would reduce the extent of tests of detail?
> What would be the most reliable audit evidence you could still obtain that you don’t yet have?
> If you need to make “enquiry” about an accounting estimate – what will you have to do to back that up?Thank you for the help sir .I will try to use this framework and yes, as you said question was not open ended ,I noticed it
Question is –
Describe the audit procedures to be performed in respect of carrying amount of the trade receivable and vehicles?Sir, can you please show me taking this question as a base ,the application of above framework (5 points as mentioned by you above)?
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