Card Set Information

2011-07-11 23:38:51

Show Answers:

  1. Unqualified Opinion
    • Introductory Paragraph: Nature of engagement
    • Scope Paragraph: worked perfomed
    • Opinion paragraph: provides reasonable assurance
    • Signed by auditor
    • Date: last day of fieldwork
  2. Introductory Paragraph
    • Financials audited
    • Managements responsibility for financials
    • Auditors responsibilities to express an opinion
  3. Scope Paragraph
    • Accordance with GAAS
    • Obtained reasonable assurance about material mistattements
    • Examined evidence
    • Assessing the accounting principles
    • Evaluated overall financial statement presentation
    • Audit provides reasonable basis for opinion
  4. Opinion Paragraph
    • Opinion: The financial statements referred to above present fairly in all material respects
    • In conformity with GAAP
  5. PCAOB Report
    • Report of Independent Registered Public Accounting Firm
    • Accordance with PCAOB
    • Signature of auditor
    • listed city and state of auditor office
  6. Emphasis of a Matter
    • Unqualified opinion with standard report
    • Additional paragraph after OPINION to emphasize the matter
  7. Emphasis of Matter Include
    • Justifiable departire from GAAP
    • Justifiable lack of consistency
    • Omission of supplementary info req by FASB, GASB, SEC
    • Material inconsistency between unaudited docs and financials
    • Uncertainty raising going concerns doubts
  8. Raising Going Concern Doubts
    • Operating losses, negative cash flows, negative trends
    • Loan defaults, dividend arrearages, financial difficulty
    • Labor difficulties or internal matters
    • Legal proceedings, declining industry
  9. Procedures for Going Concern

    • A: Analytical procedures
    • D: Debt Compliance
    • M: Minutes read
    • I: Inquiry of legals council
    • T: Third parties financial support arrangements
    • S: Subsequent events reviw
  10. Auditor does not take responsibility
    • Modify intro, scope, opinion paragrapghs
    • indicate division of responsibility
    • Other auditor maybe named if permission is reveived & report is included
  11. Scope Limitations
    • Restrictions on the actions of auditor
    • Time constraints
    • Lack of evidence
    • Unavailability of records
  12. Types of Scope Limitations
    • Unable to confirm A/R
    • Unable to obtain audited financial of investee
    • Unable to observe inventory
    • Unable to obtain letter from attorney
    • Inadequate accounting records
    • Unwilling to sign management rep letter
  13. Modify by Scope Limitation
    • Material: Qualified opinion
    • Able to express opinion on financials take as a whole
    • Pervasive: Disclaimer of opinion
    • uable to express opinion on financials taken as a whole
  14. Qualified Opinion due to Scope
    • Scope paragrapgh: Except as stated in the following paragrapgh
    • Explanatory pargrapgh: added after scope
    • Opinion paragrapgh: Except for the possible effects of....
  15. Departures from GAAP
    • Non- Gaap change in accounting principles
    • Inadequate disclosures
    • Unreasonable accounting estimates
    • Unjustifiable
    • Material: Qualified opinion
    • Pervasive: Adverse opinion
  16. Qualified/adverse due to Departure from GAAP
    • Intro and Scope same
    • Explanatory added after scope
    • Opinion paragrapgh refers to departure...except for
    • Qualified: Limited Assurance
    • Adverse: Negates Assurance
  17. Inconsistency Justified
    • Unqualified Opinion
    • Explanatory paragrapgh added after Opinion
  18. Unjustified Inconsistency
    • Qualified Opinion
    • Explanatory paragragh added after Scope
    • Opinion refers to change in accounting principle
  19. Qualified Opinion due to Inadequate disclosure
    • Standard Intro & Scope
    • Expanatory paragraph added after Scope describe natire of ommited disclosure
    • Opinion refers to Ommited disclosure
  20. Statement of Cashflow Ommited
    • Intro omit cash flow reference
    • Standard scope
    • Explanatory added after Scope
    • Opinion refers to Ommited CF
  21. Differing Opinion
    • Intro & Scope the same if Unqualified
    • Explanatory paragraph after Scope will indicate to which period the exception applies
    • Opinion paragraph will also indicate exception
  22. Reissuance of Predecessors report
    • Report is still appropriate
    • Compare prior periods to those presented
    • Obtained updated management rep letter
    • If no revision: Original date
    • If restated/revised: Dual Dated
  23. Predecessor report NOT reissued
    • Intro paragrapgh modified
    • Indicate prior period were audited by another auditor (no name)
    • Date of predecessor report
    • Type of report
    • Substantive reasons for modifications to prior period
  24. Restrictions on Auditors report
    • Contractual Agreements:restricted to parties to contract
    • Regulations:restricted to regulatory agency
    • Agreed Upon Procedures: parties agreein upon procedures
    • Inlcude in last final paragrapgh the restriction
  25. Compilations
    • No assurance
    • Does not gather evidence
    • Free from obvious error
    • No independence required
    • See accountants Compilation Report on each page
    • Dated as end of compilation
  26. Reviews
    • Limited assurance
    • Inquiries & Analitical procedures
    • Does not obtain an understanding of Internal Controls
    • Obtain a management representation letter
  27. Review Report
    • Perfomed in accordance with SSARS issued by AICPA
    • info in financials is presentation of management
    • Review consist of Inquiries and Analytical Procedures
    • Substantially less than an audit intended to express an opinion
    • No opinion is expressed
    • Not aware of any material modifications needed to conform with GAAP
    • Dated completion of inquiries and AP's
    • See Accountants Review Report on each page
  28. Effects on other information
    • Read for Consistency
    • Report on Exceptions only
    • No effect unless exception
    • Explanatory paragraph
  29. Information Required by FASB or GASB
    • Limited review procedures
    • Report on exceptions only
    • No effect unless ommision or departures
    • Explanatory paragrapgh
    • State that opinion not affected but entity has not complied
  30. Information in Auditor submitted document
    • Depends on nature of information
    • Must report but may disclaim opinion
    • No effect other than paragrah to discuss information
  31. Segment Information
    • Evaluate for errors or omisions
    • Report on exception only
    • Qualified opinion if omissions or departures or scope limitation
  32. U.S. Entity in Other Country
    • Accounting Principles in Another Country
    • For use outside US
    • Report form of other country
  33. Special Reports
    • Financials prepared under Comprehensive Basis of Accounting Other than GAAP (OCBOA)
    • Specefied elements, accounts or items of financials
    • Compliance with acpects of contractual agreements or regulatory requirements
    • Financial information provided in prescribed forms or schedules
  34. OCBOA Financials
    • Accounting used for Tax purpose (income tax return)
    • Accounting required to comply with regulatory agency
    • Cash receipts & disbursements - cash basis
    • Another set of cirteria having substantial support
  35. Prospective Financial Statements
    • Forecast: What is expected to occur under normal circumstances (General or Limited use)
    • Projections: Expected to occur hypothetical assumptions (Limited use exclusively for those negotiating with party)
  36. Compilation Report Prospective FS
    • Prospective statements presented by the responsible party
    • In accordance with AICPA
    • limited in scope does not provide a basis for an opinion
    • Prospective results may not be achieved
    • Not responsible for updating the report
    • Limitations on the use of statements if is projections**
  37. Pro-Forma Financials
    • Based on Historical Information
    • Considered an event or transaction that has not occurred
    • Restated to provide info if event/transaction had occured
    • Procedures that managements assumptions & presentation are reasonable
    • Review: Identify the financials from which historical info is derived
  38. Government Auditing Standards
    • Reasonable assurance of detecting material misttatements
    • Direct & Material effect on financials
    • Opinion on Financials
    • Info regarding the consideration of internal controls
    • Info regarding compliance with laws and regualtions
  39. Internal Control Consideration GAS
    • Indicate:
    • Scope of testing of controls
    • Understanding of IC
    • Assesment of control Risk
    • Defficiencies in the design of IC
  40. Compliance with laws & regulations GAS
    • Responsibility of Management
    • Any materials instances of Fraud & Illegal Acts discovered
  41. Single Audit Act
    • State & local Gov
    • Nonprofits receiving Federal Financial Assistance FFA
    • Engage auditor to perform Single coordinated audit
    • Relates to applicable FFA programs
  42. Single Audit Act Report
    • Opinion on Financial statements
    • Compliance with Laws & Regs
    • Internal Controls
    • General requirements applying to FFA
    • Specific requirements of Major Federal Programs
    • Specific requirements of Non major programs test
    • Report on list of Total Expenditures for each federal award
    • Schedule of reportable conditions, material noncompliance, questioned cost, known fraud
  43. General requirements Financial Federal Assitance
    • Drugfree workplace
    • Prohibits use of Federal funds for parisian political activities
    • Prohibits violations of civil rights
    • Minimizing time between receipt&disbursement of funds
  44. Major Federal Programs
    • Identify on basis of:
    • Expenditures exceeding certain amounts in realtion to total expenditires of FFA
    • Materilality is determined in relation to each program
    • Management identifies:
    • Funds received directly or inderectly from federal agencies through local, state gov, or nonprofits
  45. Attestation Engagements General Standards

    • T: Training & Proficiency
    • I: Independence
    • P: Professiocnal care in perfomance
    • P: Professional Knowledge of subject area
    • Y: Your belief that the assertaion is capable of evaluating against criteria that are suitable and available to users
  46. Attestation Standards of Fieldwork

    • Planning and supervision
    • Evidential matter as a reasonable basis for conclusion
  47. Attestation Standards of Reporting
    • Identify Assertations reported on & character engagement
    • Conclusion as to presentation of assertation in conformity with establsihed or stated criteria