Duration: 60 hours/19 weeks
To develop knowledge and understanding of the principles of external audit and the audit process and technical proficiency in the skills used for auditing financial statements.
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Description
RATIONALE
The syllabus for Paper FAU starts with an introduction to the nature and purpose of an audit, including the duties and liability of auditors, and the regulation that auditors must adhere to. The syllabus then covers the areas relating to the process of an audit of financial statements starting at audit planning and risk assessment, recording and evaluating internal control, as well as tests of controls, audit evidence and the use of substantive procedures. The final section deals with audit completion including the auditor’s report.
MAIN CAPABILITIES
On successful completion of this paper, candidates should be able to:
A. Explain the purpose and scope of an audit and its regulatory framework
B. Explain how an auditor assesses risk and plans an audit
C. Identify the principles of internal control and describe and evaluate the features of information systems
D. Identify and describe audit evidence and audit procedures required to meet the objectives of an audit and apply International Standards on
Auditing (ISAs)
E. Explain how the audit is completed and reflected in the different types of auditor’s report
Detailed Syllabus
DETAILED SYLLABUS
A Business environment and audit framework
1. The purpose and scope of an audit
2. The legal duties of auditors
3. Professional ethics
4. Auditor engagement and liability
5. Audit regulation
6. Internal audit
B Audit planning and risk assessment
1. Audit risk
2. Understanding the entity and its environment
3. Audit strategy and the audit plan
4. Audit documentation
C Internal control
1. General principles of internal control
2. Techniques to understand, record and evaluate accounting systems
3. Tests of controls
4. Communicating control deficiencies
D Audit evidence and procedures
1. Audit evidence and assertions
2. Audit procedures
3. Substantive procedures
4. Audit sampling
5. Computer-assisted audit techniques (CAATs)
E Audit completion
1. Going concern
2. Subsequent events
3. Written representations
4. Auditor’s Report
Other information
The syllabus is assessed by a two hour paper-based examination. Questions will assess all parts of the syllabus.
