Fraud (2) Flashcards
What is the auditor responsible for (scepticism)?
Maintaining professional scepticism throughout the audit, considering possibility of management override of controls
What is the auditor responsible for (procedures)?
Recognising the audit procedures effective for detecting erros may not be effective for detecting fraud
What should be done where auditor’s risk assessment suggests there is a risk of material misstatement due to risk?
It should be treated as a significant risk
What should be done in the event by auditor in event of fraud significant risk (Supervise)
Assign and supervise audit staff taking into account their knowledge, skill and ability
What should be done in the event by auditor in event of fraud significant risk (Policies)
Evaluate whether client’s accounting policies may indicate fraudulent financial reporting
What should be done in the event by auditor in event of fraud significant risk (Unpredictability)
Incorporate unpredictability in selection of the nature, timing and extent of the audit procedures
What should a discussion among audit team members place emphasis on?
Places particular emphasis on how and where financial statements may be suspectible to fraud
Risk assessment procedures to obtain information in identifying risks of material misstatement due to fraud should contain the following (management)
Enquiries of management
Enquiries of management (assessment)
Management’s assessment of the risk that the financial statements may be misstated due to fraud
Enquiries of management (process)
Management’s process for identifying and responding to the risk of fraud