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Financial statement auditors are engaged to provide reasonable assurance that financial statements are not materially misstated, whether due to fraud or error. Professional standards require auditors to obtain sufficient and appropriate evidence to support that opinion. It is critical for effective and efficient auditors to have a clear understanding of all the important elements and concepts related to properly identifying, evaluating, and deciding how to respond to risk in a financial statement audit.

Major Topics:

  • The reason that entities engage a financial statement audit
  • List the applicable financial reporting frameworks available
  • Differentiate the responsibilities of reporting entity management and auditors
  • The various phases of a financial statement audit
  • Evaluating and documenting audit risk, both at the overall and relevant assertion level
  • Case study differentiating high-risk audit engagements and higher-risk audit areas

Learning Objectives

  • Discover and discuss the basis for an audit.
  • Explore and explain the auditor’s professional responsibilities.
  • Identify and describe important audit concepts, such as materiality.
  • Recognize and explain the foundational principles of the audit risk formula.
  • Discover and discuss considerations when Identifying and assessing risk of material misstatement.
Last updated/reviewed: June 12, 2021

Included In Certifications

This course is included in the following Certification Programs:

13 CoursesAudit Training Level 1 - Beginning Staff

  1. Professional Skepticism - Creating a Mindset for Finding Fraud and Error
  2. Audit Documentation - Creating Workpapers That Pass Review
  3. Adapting to the Engagement - Differentiating the Requirements of Preparations, Compilations, Reviews, and Audits
  4. The Audit Risk Model - Understanding Foundational Principles
  5. Internal Control Fundamentals - Satisfying Audit Requirements for Evaluating Design and Implementation
  6. Auditing Cash - Applying Basic Skills to the Starting Point of Any Audit
  7. Auditing PP&E, Including Leases under Topic 842 - Digesting the Risks of Improper Treatment of Tangible Long-Lived Assets
  8. Auditing Inventory - Performing Required Observations and Other Common Procedures
  9. Analytical Procedures - Comprehending Financial Statement Audit Fundamentals
  10. Audit Reporting Fundamentals - Introducing Core Concepts in the Audited Financial Statement Drafting and Issuance Process
  11. AICPAs Code of Professional Conduct - Exploring the Foundational Principles Underlying the CPA Profession as a Whole
  12. Accounting Update - Hot Topics for Preparing Current Period Financial Statements
  13. Auditing & Attest Update - Hot Topics for Current Period Audits and Other Attest Services

Prerequisites

Course Complexity: Foundational

No Advanced Preparation or Prerequisites are needed for this course.
Designed For: Professionals requiring knowledge of fundamental audit concepts.

Education Provider Information

Company:
Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact:
For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Course Syllabus
INTRODUCTION AND OVERVIEW
  0:55Learning Objectives for The Audit Risk Model
  8:27Introduction
  14:11Responsibilities on An Audit
  14:46Phases of an Audit
  16:12Overview of the Audit Risk Concept
  13:49Concept of Materiality
  19:11Applying the Audit Risk Model
  7:47Assessing Assertion Level Risk
  4:42Risk Assessment Summary
Continuous Play
  1:39:59The Audit Risk Model
Supporting Materials
  PDFSlides: The Audit Risk Model - Understanding Foundational Principles
  PDFThe Audit Risk Model - Understanding Foundational Principles Glossary/Index
Review And Test
  quizREVIEW QUESTIONS
 examFINAL EXAM