Chapter 7 – Audit Evidence · PDF fileChapter 7 ©2008 Prentice Hall Business Publishing, Auditing 12/e, Arens/Beasley/Elder 7 - 3 Learning Objective 1 ... Auditing 12/e, Arens/Beasley/Elder

©2008 Prentice Hall Business Publishing, ©2008 Prentice Hall Business Publishing, Auditing 12/e,Auditing 12/e, Arens/Beasley/Elder Arens/Beasley/Elder 7 - 1

TES TRANSAKSITEST OF RECORDED TRANSACTIONTEST OF RECORDED TRANSACTION


Audit Evidence

Chapter 7

©2008 Prentice Hall Business Publishing, ©2008 Prentice Hall Business Publishing, Auditing 12/e,Auditing 12/e, Arens/Beasley/Elder Arens/Beasley/Elder 7 - 7 - 33

Learning Objective 1

Contrast audit evidence withevidence used by otherprofessions.


Standar Pekerjaan Lapangan Ketiga IAPI (2011:326.1)

Bukti audit kompeten yang cukup harus diperoleh melalui inspeksi, pengamatam, permintaan keterangan dan konfirmasi sebagai dasar yang memadai untuk menyatakan pendapat atas Laporan Keuangan Auditan


Nature of Evidence

The use of evidence is not unique to auditors

Evidence is also used by scientists, lawyers,and historians

Audit Evidence vs Legal Evidence

• Ukuran Keabsahan (Validity)• Relevansi (Relevance)• Ketepatan Waktu (Timeliness)• Keberadaan Bukti Pendukung Lain (Supporting Other evidence)

Kompetensi Kompetensi BuktiBukti



Identify the four audit evidencedecisions that are needed tocreate an audit program.


Audit Evidence Decisions

1. Which audit procedures to use

2. What sample size to select for a given procedure

3. Which items to select from the population

4. When to perform the procedures (timing)


Audit Program

It includes a list of the audit proceduresthe auditor considers necessary.

Most auditors use computers to facilitatethe preparation of audit programs.

Sample sizes Items to select Timing of the tests



Specify the characteristics thatdetermine the persuasivenessof evidence.


Persuasiveness of Evidence

Appropriateness

Sufficiency

Two determinants:


Six Characteristics of Reliable Evidence1. Independence of provider

2. Effectiveness of client’sinternal controls

3. Auditor’s direct knowledge

(Independensi dari Provider)(Independensi dari Provider)

(Efektifitas IC Klien)(Efektifitas IC Klien)

(Pengetahuan Langsung Auditor)(Pengetahuan Langsung Auditor)


Six Characteristics of Reliable Evidence4. Qualification of individuals

providing the information

5. Degree of objectivity

6. Timeliness

(Kualifikasi Individual dari (Kualifikasi Individual dari Penyedia Informasi)Penyedia Informasi)

(Derajat Obyektifitas)(Derajat Obyektifitas)

(Ketepatan Waktu)(Ketepatan Waktu)


Relationships Among Audit Evidence and Persuasiveness

Audit Evidence DecisionsQualities Affecting Persuasivenessof Evidence

Audit procedures and timing Appropriateness Relevance Reliability Independence of provider Effectiveness of internal controls Auditor's direct knowledge Qualifications of provider Objectivity of evidence Timeliness When procedures are performed Portion of period being audited

Sample size and items to select Sufficiency Adequate sample size Selection of proper population items


Persuasiveness and CostIn making decisions about evidencefor a given audit, both persuasivenessand cost must be considered.

The auditor’s goal is to obtain asufficient amount of appropriateevidence at the lowest total cost.

(Keputusan Audit atas Bukti (Keputusan Audit atas Bukti Audit, Persuasiveness & Cost )Audit, Persuasiveness & Cost )

(Tujuan Auditor mendapatkan jumlah yg Cukup, (Tujuan Auditor mendapatkan jumlah yg Cukup, atas kelayakan Bukti dengan atas kelayakan Bukti dengan Biaya TerendahBiaya Terendah))



Identify and apply the eight typesof evidence used in auditing.


Types of Audit Evidence

1. Physical examination2. Confirmation3. Documentation4. Analytical procedures5. Inquiries of the client6. Recalculation7. Reperformance8. Observation


Types of Audit Evidence (Soekrisno Agoes)

1. Physical Evidence :Segala sesuatu yang bisa 1. Physical Evidence :Segala sesuatu yang bisa dihitung, dipelihara, diobservasi atau diinspeksi dihitung, dipelihara, diobservasi atau diinspeksi --- > mendukung tujuan eksistensi & keberadaan --- > mendukung tujuan eksistensi & keberadaan mis: bukti fisik kas opname, bukti fisik stock mis: bukti fisik kas opname, bukti fisik stock opname dllopname dll

2. Confirmation Evidence :Bukti yang diperoleh 2. Confirmation Evidence :Bukti yang diperoleh mengenai eksistensi/ penilaian langsung dari mengenai eksistensi/ penilaian langsung dari pihak ketiga. Mis: jawaban Konfirmasi Piutang, pihak ketiga. Mis: jawaban Konfirmasi Piutang, Utang dllUtang dll



3. Documentary Evidence :Catatan akuntansi 3. Documentary Evidence :Catatan akuntansi dan seluruh dokumen pendukung. Terkait dengan dan seluruh dokumen pendukung. Terkait dengan ASERSI manajemen ‘Completeness & Existence’ ASERSI manajemen ‘Completeness & Existence’ AUDIT TRAIL – Tracking & Vouching (Bukti – AUDIT TRAIL – Tracking & Vouching (Bukti – Journal – Buku Besar – Journal – Bukti )Mis: Journal – Buku Besar – Journal – Bukti )Mis: Copy faktur, Journal Voucher, General Ledger Copy faktur, Journal Voucher, General Ledger dan Sub Ledgerdan Sub Ledger



4. Mathematical Evidence: Perhitungan, 4. Mathematical Evidence: Perhitungan, Perhitungan kembali, rekonsiliasi. Mis: Footing, Perhitungan kembali, rekonsiliasi. Mis: Footing, Cross footing & extension atas rekon bank, kas, Cross footing & extension atas rekon bank, kas, piutang, utang, piutang, utang,

5. Analytical Evidence: bukti yg diperoleh 5. Analytical Evidence: bukti yg diperoleh melalui penelaahan analitis thd informasi melalui penelaahan analitis thd informasi keuangan klien – dilakukan sebelum substantive keuangan klien – dilakukan sebelum substantive test dan pada akhir audit lapangantest dan pada akhir audit lapangan



Prosedur analitis dilakukan dg cara:Prosedur analitis dilakukan dg cara: Trend (Horizontal) Analysis : membandingkan Trend (Horizontal) Analysis : membandingkan angka LK periode berjalan dg periode angka LK periode berjalan dg periode sebelumnya, selidiki signifikansi kenaikan/ sebelumnya, selidiki signifikansi kenaikan/ penurunan jumlah rupiah/ prosentasepenurunan jumlah rupiah/ prosentase Common Size (Vertical) Analysis Common Size (Vertical) Analysis Ratio Analysis a.l Likuiditas, Profitabilitas, Ratio Analysis a.l Likuiditas, Profitabilitas, SolvabilitasSolvabilitas



4. Hersay (oral) evidence: Bukti dalam bentuk 4. Hersay (oral) evidence: Bukti dalam bentuk jawaban lisan dari klien atas pertanyaan-jawaban lisan dari klien atas pertanyaan-pertanyaan yang diajukan auditor. pertanyaan yang diajukan auditor.


RelationshipsAuditing

standards

Evidenceaccumulation

Types ofevidence

Auditprocedures

Qualificationsand conduct

Sample sizeand itemsto select Timing

of tests

ReportingPhysical examination

ConfirmationDocumentation

Analytical proceduresInquiries of the client

RecalculationReperformance

Observation

Broad guidelinesconcerning auditorqualifications andconduct, evidence

accumulation,and reporting

Broad categories ofevidence available

for the auditor’saccumulation

Specific instructionsfor the accumulationof types of evidence

FOURAUDIT

EVIDENCEDECISIONS


Physical Examination

It is the inspection or count by theIt is the inspection or count by theauditor of a auditor of a tangible assettangible asset..

This type of evidence is most oftenThis type of evidence is most oftenassociated with inventory and cash.associated with inventory and cash.


Confirmation

Information Source

AssetsAssets

Cash in bankAccounts receivableNotes receivableOwned inventory out on consignmentInventory held in public warehousesCash surrender value of life insurance

BankCustomerMakerConsigneePublic warehouseInsurance company


Confirmation

Information Source

LiabilitiesLiabilities

Accounts payableNotes payableAdvances from customersMortgages payableBonds payable

CreditorLenderCustomerMortgagorBondholder


Confirmation

Information Source

Owners’ EquityOwners’ Equity

Shares outstanding Registrar andtransfer agent

Other InformationOther Information

Insurance coverageContingent liabilities

Bond indenture agreementsCollateral held by creditors

Insurance companyBank, lender, and client’s legal counselBond holderCreditor


Documentation

It is the auditor’s inspection of theclient’s documents and records.

Internaldocuments

Externaldocuments


Analytical Procedures

Understand the client’s industry and business

Assess the entity’s ability to continue as agoing concern

Indicate the presence of possible misstatementsin the financial statements

Reduce detailed audit tests


Inquiries of the Client

It is the obtaining of written or oral information from the client in response to questions from the auditor.


Recalculation

It involves rechecking a sample of calculationsmade by the client.


Reperformance

It is the auditor’s independent tests of clientaccounting procedures or controls thatwere originally done.


Observation

It is the use of the senses to assess client activities.

The auditor may tour the plant to obtain a generalimpression of the client’s facilities.


Appropriateness of Types of Evidence Type of evidence Independence of provider Effectiveness of client’s internal controls Auditor’s direct knowledge Qualifications of provider Objectivity of evidence


Terms and Types of Evidence

Terms Type of Evidence

ExamineScanReadComputeRecomputeFootTraceCompareCountObserveInquireVouch

DocumentationAnalytical proceduresDocumentationAnalytical proceduresRecalculationRecalculationDocumentation/ReperformanceDocumentationPhysical examinationObservationInquiries of clientDocumentation


Substantive Test & Compliance Test

Compliance Test: Compliance Test: Tes terhadap bukti-bukti Tes terhadap bukti-bukti pembukuan yang mendukung transaksi yang pembukuan yang mendukung transaksi yang dicatat perusahaan untuk mengetahui apakah dicatat perusahaan untuk mengetahui apakah setiap transaksi yang terjadi sudah diproses dan setiap transaksi yang terjadi sudah diproses dan dicatat sesuai dengan sistem dan prosedur yang dicatat sesuai dengan sistem dan prosedur yang ditetapkan Manajemen.ditetapkan Manajemen.Jika terjadi penyimpangan, material/ tidak Jika terjadi penyimpangan, material/ tidak material auditor hrs memperhitungkan pengaruh material auditor hrs memperhitungkan pengaruh penyimpangan tersebut terhadap efektivitas penyimpangan tersebut terhadap efektivitas Pengendalian InternalPengendalian Internal


Compliance Test

Compliance test Compliance test aspek kelemahan/ aspek kelemahan/ penyimpangan yang muncul diatasi dengan penyimpangan yang muncul diatasi dengan Compensating ControlCompensating Control

Compliance test consideration items :Compliance test consideration items :b.b.The Completeness of supporting documentsThe Completeness of supporting documentsc.c.Mathematical analysis: footing, crossfooting, Mathematical analysis: footing, crossfooting, extensionextensiond.d.Legalisation from the Authorized PersonLegalisation from the Authorized Persone.e.The Account verificationThe Account verificationf.f.Posting Journals to Ledger verification Posting Journals to Ledger verification


Substantive Test

Substantive test Substantive test : Tes terhada kewajaran : Tes terhada kewajaran saldo-saldo dalam Laporan Keuangansaldo-saldo dalam Laporan Keuangan

Prosedur Substantive Test a.l:Prosedur Substantive Test a.l:b.b.Inventarisasi Aset TetapInventarisasi Aset Tetapc.c.Observasi atas Stock OpnameObservasi atas Stock Opnamed.d.Konfirmasi Piutang, utang dan bankKonfirmasi Piutang, utang dan banke.e.Kas Opname Kas Opname f.f.Pemeriksaan rekonsiliasi bank dllPemeriksaan rekonsiliasi bank dll


Cara Pemilihan Sample

Sampling Audit Sampling Audit : Penerapan prosedur audit : Penerapan prosedur audit thd unsur” suatu saldoatau kelompok transaksi thd unsur” suatu saldoatau kelompok transaksi yang kurang dari 100% dg tujuan utk meneliti yang kurang dari 100% dg tujuan utk meneliti karakteristik dari akun atau kelompok transaksi karakteristik dari akun atau kelompok transaksi tssb. tssb.

Metode Sampling:Metode Sampling:• Random/ Judgement SamplingRandom/ Judgement Sampling•Block SamplingBlock Sampling•Statistical SamplingStatistical Sampling



Understand the purposes ofaudit documentation.


Audit Documentation

Audit documentation is the principal recordof auditing procedures applied, evidenceobtained, and conclusions reached bythe auditor in the engagement.


Audit Documentation

Purposes of audit documentation

Ownership of audit files

Confidentiality of audit files


Sarbanes-Oxley Act

The Sarbanes-Oxley Act requires auditors ofpublic companies to prepare and maintainaudit working papers for a period of noless than seven years.



Prepare organized auditdocumentation.


Audit File Contents and Organization

Robinson AssociatesRobinson AssociatesTrial BalanceTrial Balance

12/31/0712/31/07

CashCash $165,237$165,237Accounts ReceivableAccounts Receivable 275,050 275,050Prepaid InsurancePrepaid Insurance 37,795 37,795Interest ReceivableInterest Receivable 20,493 20,493

Financial Statementsand Audit Report



Working TrialBalance


Adjusting JournalEntries


ContingentLiabilities


Operations


Liabilitiesand Equity


Assets


AnalyticalProcedures


Tests of Controls andSubstantive TOT


InternalControl


GeneralInformation


AuditPrograms

Financial Statementsand Audit ReportPermanent Files


Permanent Files

These files are intended to containdata of a historical or continuingnature pertinent to the current audit.


Current Files

Audit program

General information

Working trial balance

Adjusting and reclassification entries

Supporting schedules


Relationship of Audit Documentationto Financial Statements

FINANCIAL STATEMENTSCash 122Acc.

WORKING TRIAL BALANCE Prelim. AJE’s Final

Cash 212 (90) 122

AJE’sExpense 90

Cash 90

LEAD SCHEDULE–CASH A-1 Per G/L AJE’s Final

Petty Cash A-2 5 5Cash in Bank:

General A-3 186 (90) 96Payroll A-4 21 21

212 (90) 122


Relationship of Audit Documentationto Financial Statements

A-3/1Confirmation

A-3/2O/S Check List

A-4/2O/S Check List

A-4/1Confirmation

A-2Cash Count Sheet

A-3Bank Reconciliation

A-4Bank Reconciliation

LEAD SCHEDULE–CASH A-1 Per G/L AJE’s Final

Petty Cash A-2 5 5Cash in Bank:

General A-3 186 (90) 96Payroll A-4 21 21

212 (90) 122


Types of Supporting Schedules Analysis

Trial balance or list

Reconciliation of amounts

Tests of reasonableness


Types of Supporting Schedules Summary of procedures

Examination of supporting documents

Informational

Outside documentation


Preparation of Audit Documentation

Each audit file should be properly identified

Documentation should be indexed andcross-referenced

Completed documentation must clearlyindicate the audit work performed

It should include sufficient information

It should plainly state the conclusions reached



Describe how e-commerceaffects audit evidence andaudit documentation.


Effect of E-commerce

Audit evidence is increasingly in electronic form

Auditors must evaluate how electronic informationaffects their ability to gather evidence

Auditors use computers to read and examineevidence

Software programs are typically Windows-based


End of Chapter 7

Documents

Chapter 7 – Audit Evidence · PDF fileChapter 7 ©2008 Prentice Hall Business Publishing, Auditing 12/e, Arens/Beasley/Elder 7 - 3 Learning Objective 1 ... Auditing 12/e, Arens/Beasley/Elder