Auditing And Assurance

Tests of chastenesss
Introduction
The previous module dealt with internal control principles. These enable the attender to evaluate whether the clients accounting and other systems ar vulnerable to error or fraud; whether the systems are acting as laid down by organisation constitution; and to what extent the existing controls puke be relied upon by the scrutinizeed accountors when doing their assorted footraces and evaluations. There are two major types of audit tests: tests of controls and of the essence(p) tests. In this module we focus on tests of controls that support the assessed direct of control chance. Substantive tests will be covered in Module 9.





Learning objectives
On completion of this module you should be able to: » » » » » » » explain that tests of controls are part of a duplicate approach to the audit identify the types of tests of controls undertaken identify factors impacting the auditors assessment of the sufficiency and appropriateness of evidence of tests of controls describe the audit procedures for test controls in the revenues, receivables and receipts system describe the audit procedures for testing controls in the expenditures payables and disbursements system describe the audit procedures for testing controls relating to contractual transactions apply the auditing approaches used to test the controls contained in the clients program.

Textbook Gay & Simnett 2007 Chapter 9 certified public accountant Handbook 2008

Tests of controls
The auditor may assess the level of control risk from high to low. If the control environment, control procedures and information systems are assessed as strong, hence the preliminary assessment of control risk would normally be assessed as low. Thus, it is cost effective to test controls and a final assessment of control risk can be made at the completion of this testing. These results will then determine how much substantive testing of balances will be required. Understanding of internal control includes an understanding of the five components of...If you desire to get a full essay, order it on our website: Orderessay



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