D_Audit Respon n Evidence

8/18/2019 D_Audit Respon n Evidence

1/87


2/87

6 - 2

Learning Objective 1

Explain the objective of

conducting an audit of

financial statements.


3/87

6 - 3

Objective of Conducting an Auditof Financial Statements

The purpose of an audit is to provide financialstatement users with an opinion by the auditor

on whether the financial statements arepresented fairly, in all material respects, in

accordance with applicable financial accountingframework.


4/87

6 - 4

Steps to Develop Audit Objectives

Understand objectives andresponsibilities for the audit.1

2

Divide financial statements

into cycles.

3 Know management

assertions about accounts.

Know general audit objectives for classesof transactions, accounts and disclosures.4

5 Know specific audit objectives for classesof transactions, accounts and disclosures.


5/87

6 - 5


Distinguish management’s

responsibilities for preparingfinancial statements from the

auditor’s responsibilities for

verifying those financial

statements.

Understand objectives andresponsibilities for the audit.

Divide financial statementsinto cycles.

Know managementassertions about accounts.

Know general audit objectivesfor classes of transactions,accounts and disclosures.

Know specific audit objectivesfor classes of transactions,accounts and disclosures.


6/87


7/876 - 7


Explain the auditor’s

responsibility for discoveringmaterial misstatements.




Know general audit objectivesfor classes of transactions,accounts and disclosures



8/876 - 8

Auditor’s Responsibilities

PSA No. 02 (SA Seksi 110 para 02)

Auditor bertanggungjawab untuk merencanakan dan

melaksanakan audit untuk memperoleh keyakinan memadaiapakah laporan keuangan bebas dari salah saji material, baik yangdisebabkan oleh kekeliruan atau kecurangan. Oleh karena sifatbukti audit dan karakteristik kecurangan, auditor dapatmemperoleh keyakinan memadai, namun bukan mutlak, bahwa

salah saji material terdeteksi. Auditor tidak bertanggungjawab,untuk merencanakan dan melaksanakan audit guna memperolehkeyakinan bahwa salah saji terdeteksi., baik yang disebabkan olehkekeliruan atau kecurangan, yang tidak material terhadap laporankeuangan.


9/876 - 9

Auditor’s Responsibilities

Material versus immaterial misstatements

Reasonable assurance versus absolute

Errors versus fraud

Professional skepticism

•Sampling

•Estimates


10/876 - 10

Responsibilities forDiscovering Illegal Acts

Illegal acts are defined as violations of laws

or government regulations other than fraud.Examples: a violation of tax laws and a violation

of the environmental protection laws.


11/876 - 11

Responsibilities forDiscovering Illegal Acts

Direct-effect illegal acts

Indirect-effect illegal acts

Evidence accumulation when there is no reasonto believe indirect-effect illegal act exists

Evidence accumulation and other actions when there

is reason to believe direct- or indirect-effectillegal acts may exist

Actions when the auditorknows of an illegal act


12/876 - 12


Classify transactions and

account balances intofinancial statement

cycles and identify benefits

of a cycle approach tosegmenting the audit.







13/876 - 13

Transaction Flow Example

Transactions JournalsLedger, Trial Balance, and

Financial Statements

Acquisitionof goods and services

Cash receipts journal

Sales Sales journal

Cash receipts

Acquisitions journal

General ledgerand subsidiary

records

General ledger

trial balance

Financialstatements Allocation and

adjustments

Payroll journal

Cashdisbursements

Cash disburse-ments journal

Payrollservices and

disbursements

General

journal


14/876 - 14

Relationships AmongTransaction Cycles

Generalcash

Capital acquisitionand repayment cycle

Sales andcollection

cycle

Acquisitionand payment

cycle

Payroll andpersonnel

cycle

Inventory andwarehousing

cycle


15/876 - 15


Describe why the auditor obtains

a combination of assurance byauditing classes of transactions

and ending balances in accounts,including presentation and

disclosure.







16/876 - 16

Balance and Transactions Affecting Balances Example

$ 19,454

144,328

$ 20,197

139,020

1,242

3,328Charge-off ofuncollectible

debts

Cash

receipts

Sales returnsand allowances

Sales

Accounts Receivable (in thousands)

Beginning balance

Ending balance


17/876 - 17


Distinguish among the three categoriesof management assertions about

financial information.


18/876 - 18

Assertions are representations bymanagement that are embodied in financial

statement components, records, or systems

Example:

• The financial statements represent fairmeasurements of the economic events and

business transactions that affected theorganization during a certain period of time.

Broad Definition of Auditing


19/876 - 19

Management Assertions

Assertions about classes oftransactions and events for

the period under audit

Assertions about accountbalances a period end

Assertions about presentationand disclosure


20/876 - 20

Management Assertions forEach Category of Assertions

Assertions About Classesof Transactions and Events

Assertions AboutAccount Balances

Assertions AboutPresentation and Disclosure

Occurrence ExistenceOccurrence and rights

and obligationsCompleteness Completeness Completeness

AccuracyValuation and

allocationAccuracy and

valuation

Classification Classification andunderstandability

Cutoff

Rights andobligations


21/87

6 - 21


List the six general transaction-

related audit objectives to themanagement assertions.







22/87

6 - 22

Transaction-Related Audit Objectives

Occurrence

Completeness

Accuracy

Recordedtransactions exist.

Existing transactionsare recorded.

Recorded transactionsare stated at thecorrect amount.


23/87

6 - 23

Transaction-Related Audit Objectives

Classification

Timing

Posting and

summarization

Transactions areproperly classified.

Transactions are recordedon the correct dates.

Transactions are includedin the master files and

are correctly summarized.


24/87

6 - 24

Management Assertions andTransaction-related Audit Objectives

Management AssertionsAbout Classes of

Transactions and Events

General Transaction-related Audit

Objectives

Specific Sales Transaction-related Audit Objectives

Occurrence Occurrence Recorded sales are forshipments made to

nonfictitious customers

Completeness Completeness Existing sales

transactions are recorded

Accuracy Accuracy Recorded sales are forthe amount of goods

shipped and are correctlybilled and recorded

Hillsburg Hardware Company:As Applied to Sales Transactions


25/87

6 - 25


Accuracy Posting andsummarization

Sales transactions areproperly included in the

master file and arecorrectly summarized

Classification Classification Sales transactions areproperly classified

Cutoff Timing Sales transactions arerecorded on the correct

dates.

Management AssertionsAbout Classes of

Transactions and Events

General Transaction-related AuditObjectives

Specific Sales Transaction-related Audit Objectives

Hillsburg Hardware Company:As Applied to Sales Transactions


26/87

6 - 26


Link the eight general balance-

related audit objectives to thefive management assertions.




Know general audit objectivesfor classes of transactionsand accounts.

Know specific audit objectivesfor classes of transactions

and accounts.


27/87

6 - 27

General Balance-Related Audit Objectives

Existence

Completeness

Accuracy

Amountsincluded exist.

Existing amountsare included.

Amounts includedare stated at thecorrect amounts.

G l B l R l d


28/87

6 - 28


Classification

Cutoff

Detail tie-in

Amounts areproperly classified.

Transactions are recordedin the proper period.

Account balances agreewith master file amounts,

and with the general ledger.

G l B l R l t d


29/87

6 - 29


Realizablevalue

Rights andobligations

Assets are included atestimated realizable value.

Assets must be owned.


30/87

6 - 30


Management AssertionsAbout Account Balances

General Balance-related Audit

Objectives

Specific Balance-related AuditObjectives Applied to Inventory

Existence Existence All recorded inventory existsat the balance sheet date

Completeness Completeness All existing inventory hasbeen counted and includedin the inventory summary

Hillsburg Hardware Company:As Applied to Inventory


31/87

6 - 31




ObjectivesValuation and

allocationAccuracy Inventory quantities on the

client’s perpetual records agree with items physically

on handPrices used to value

inventories are materiallycorrect

Extensions of price timesquantity are correct and

details are correctly added




32/87

6 - 32





allocationClassification

Cutoff

Inventory items are properlyclassified as to raw

materials, work in process,and finished goods

Purchase cutoff at year endis proper

Sales cutoff at year end isproper




33/87

6 - 33





allocationDetail tie-in

Realizablevalue

Total of inventory itemsagrees with general ledger

Inventories have been writtendown where net realizable

value is impaired



Rights and obligations Rights andobligations

The company has title to allinventory items listed

Inventories are not pledgedas collateral


34/87

6 - 34


Link the four presentation anddisclosure-related audit objectives tomanagement assertions for

presentation and disclosure.


35/87

6 - 35

Management Assertions and Presentationand Disclosure-related Audit Objectives

Hillsburg Hardware Company:As Applied to Notes Payable

ManagementAssertions About

Presentation andDisclosure

Specific Presentation andDisclosure-related Audit Objectives

Applied to Notes Payable

Occurrenceand rights and

obligations

Occurrenceand rights and

obligations

Notes payable as described in thefootnotes exist and are

obligations of the companyCompleteness Completeness All required disclosures related

to notes payable are included inthe financial statement footnotes

GeneralPresentation-

and Disclosure-related AuditObjectives


36/87

6 - 36

Management Assertions and Presentationand Disclosure-related Audit Objectives

Hillsburg Hardware Company:As Applied to Notes Payable

ManagementAssertions About

Presentation andDisclosure

Specific Presentation andDisclosure-related Audit Objectives

Applied to Notes Payable

Valuation andallocation

Valuation andallocation

Footnote disclosures related tonotes payable are accurate.

Classificationand

understandability

Classificationand

understandability

Notes payable are appropriatelyclassified as to short-term and

long-term obligations andrelated financial statement

disclosures are understandable

GeneralPresentation-

and Disclosure-related AuditObjectives


37/87

6 - 37


Explain the relationship

between audit objectivesand the accumulation

of audit evidence.

H A dit Obj ti


38/87

6 - 38

How Audit Objectives Are Met

Auditors plan the combinationof objectives and evidence by

following an audit process.

An audit process is a methodologyfor organizing an audit.


39/87

6 - 39

Four Phases of an Audit

Phase I

Phase II

Phase III

Phase IV

Plan and design

an audit approach.

Perform tests ofcontrols and

substantive testsof transactions.

Perform analyticalprocedures and

tests of detailsof balances.

Complete theaudit and issuean audit report.


40/87

6 - 40

Tugas

Bacalah standar auditing berikut ini:

SA Seksi 110 (PSA 02)







41/87

6 - 41

End of Chapter 6


42/87

6 - 42

Audit Evidence

Chapter 7


43/87

6 - 43

Broad Definition of Auditing

Auditing is a systematic process ofobjectively obtaining and evaluating

evidence regarding assertions abouteconomic actions and events to ascertainthe degree of correspondence betweenthese assertions and established criteria

and communicating the results to interestedusers.


44/87

6 - 44

Definition of Evidence

Evidence is any information used by the

auditor to determine whether theinformation being audited is stated in

accordance with the established criteria


45/87

6 - 45


Contrast audit evidence

with evidence used byother professions.


46/87

6 - 46

Nature of Evidence

The use of evidence isnot unique to auditors.

Evidence is also usedby scientists, lawyers,

and historians.


47/87

6 - 47


Identify the four audit evidence

decisions that are needed tocreate an audit program.


48/87

6 - 48

Four Audit Evidence Decisions

1. Which audit procedures to use

2. What sample size to select for a given procedure3. Which items to select from the population

4. When to perform the procedures


49/87

6 - 49

Audit Program

It includes a list of the audit procedures

the auditor considers necessary.

Most auditors use computers to facilitatethe preparation of audit programs.


50/87

6 - 50


Specify the characteristics

that determine thepersuasiveness

of evidence.


51/87

6 - 51

Standard of Field Work

Sufficient competent evidential matter is to

be obtained through inspection,observation, inquiries, and confirmations to

afford a reasonable basis for an opinionregarding the financial statements under

audit


52/87

6 - 52

Competence

Refers to the degree to which evidence can

be considered believable or worthy of trust


53/87

6 - 53

Competence

Relevance

Independence of provider

Effectiveness of internal controls

Auditor’s direct knowledge

Qualifications of individuals

Degree of objectivity

Timeliness


54/87

6 - 54

Sufficiency

Sample size

Individual item tested


55/87

6 - 55


Identify and apply the

Eight types of evidenceused in auditing.


56/87

6 - 56

Types of Audit Evidence

1. Physical examination

3. Documentation

5. Inquiries of the client

6. Recalculation

2. Confirmation

4. Analytical procedures

7. Reperformance

8. Observation

Information


57/87

6 - 57

InformationOften Confirmed

Information Source

AssetsCash in bank Bank Accounts receivable CustomerNotes receivable Maker

Owned inventory out on consignment ConsigneeInventory held in public warehouses WarehouseCash surrender value of life insurance Insurance co.

Information


58/87

6 - 58


Information Source

Liabilities

Accounts payable CreditorNotes payable Lender

Advances from customers Customer

Mortgages payable MortgagorBonds payable Bondholder

Information


59/87

6 - 59


Information Source

Owners’ Equity

Shares outstanding Registrar andtransfer agent

Information


60/87

6 - 60


Information Source

Other Information Insurance coverage Insurance companyContingent liabilities Bank, lender, and

client’s counsel

Bond indenture agreements BondholderCollateral held by creditors Creditor

Competence of Types of


61/87

6 - 61

Competence of Types ofEvidence

Types of Evidence and Four


62/87

6 - 62

Types of Evidence and FourEvidence Decisions


63/87

6 - 63

Terms and Types of Evidence

Terms Types of Evidence

Examine Documentation

Scan Analytical procedures

Read

Analytical procedures

Documentation

ComputeRecompute Reperformance

Foot Reperformance


64/87

6 - 64

Terms and Types of Evidence

Terms Types of Evidence

Trace Documentation

Compare Documentation

Count

Observation

Physical examination

ObserveInquire Inquiries of client

Vouch Documentation


65/87

6 - 65


Understand the purposes

of audit documentation.


66/87

6 - 66

Audit Documentation

Audit documentation is the principal

record of auditing procedures applied,evidence obtained, and conslusions

reached by the auditor in the

engagement.

Four Purposes of Audit


67/87

6 - 67

Four Purposes of AuditDocumentation

A basis for planning the audit

A record of the evidence accumulated andthe results of the tests

Data for determining the proper type of

audit report

A basis for review by supervisors andpartners


68/87

6 - 68

SYARAT KKA YANG BAIK

LENGKAP

Memuat informasi yang lengkap sehingga tidak memerlukan penjelasantambahan secara lisan.

TELITI

Bebas dari kesalahan pencatatan, perhitungan dan penyajian informasi. JELAS

Mempunyai tujuan yang jelas dan mudah dimengerti pembacanya

RINGKAS

Hanya dibatasi pada hal-hal penting dan ada hubungannya dengan obyekaudit

RAPI

Diatur dengan rapi agar memudahkan penelaahan.

BERDASARKAN FAKTA DAN ARGUMENTASI LOGIS

Mencerminkan fakta yang diperoleh dari hasil audit dan informasi yangdisajikan logis bagi pembacanya.


69/87

6 - 69

PRINSIP PEMBUATAN KKA

Semua KKA harus ada tujuannya

Hindarkan pekerjaan salin menyalin

Hindarkan menulis ulang KKA

Tulis semua teknik audit yang digunakan

Tulis setiap informasi/komentar atau hal-halpenting dalam KKA

Buktikan keterangan lisan yang diterima Pertanyaan jangan ditinggalkan tidak terjawab.


70/87

6 - 70

PROSEDUR PENGISIAN KKA (1)

Dibuat di atas blanko yang telah disiapkan sebelumnya

Penulisan KKA supaya menggunakan satu muka saja

Pada halaman pertama sebelah kiri atas, tulislah: namaobyek, kegiatan, lokasi dan periode yang diperiksa

Pada halaman pertama sebelah kanan atas tulis nomorKKA, nomor langkah kerja, nama penyusun, tanggal danparaf, nama petugas yang mereview, tanggal dan paraf

Di bagian tengah, tulis judul dari KKA

Untuk setiap KKA yang memerlukan referensi, perludituliskan nomor referensinya

PROSEDUR PENGISIAN KKA


71/87

6 - 71

PROSEDUR PENGISIAN KKA (2)

Setiap daftar penunjang harus dibuat pada lembar KKAyang terpisah

Untuk setiap kegiatan yang diperiksa harus dinyatakan

teknik audit yang digunakan Gunakan simbol-simbol audit pada KKA

Jika ada koreksi harus dinyatakan dengan jelas

Gunakan tinta yang berbeda untuk level yang berbeda


72/87


73/87

6 - 73

PEMBERIAN INDEKS KKA

MANFAAT:

Memudahkan pelaksanaan review KKA baik

oleh pengawas maupun pihak lain. Memudahkan auditor dalam meneliti kembali

KKA

Memudahkan mencari informasi pendukung

yang diperlukan dalam penyusunan laporan.


74/87

6 - 74

CARA PEMBERIAN INDEKS

SISTEM ANGKA

Tiap rincian utama diberi nomor urut angka romawi,sedangkan rincian penunjang dengan angka arab.

SISTEM HURUF

Tiap rincian utama diberi kode urut alphabet, sedangkanrincian penunjang dengan angka arab

SISTEM NOMOR URUT

Baik rincian utama maupun rincian penunjang diberinomor urut angka arab


75/87

6 - 75


Prepare organized

audit documentation.


76/87

6 - 76

SUSUNAN BERKAS KKA

Setiap KKA yang dibuat harus dihimpun di dalam odner

Pada kulit depan di sudut kiri atas dicantumkan nama KAP yangbersangkutan.

Pada kulit depan di sudut kanan atas ditulis tanggal aktif, tanggal tidakaktif dan nomor berkas.

Di tengah-tengah kulit depan dan di punggung odner ditulis “Kertas Kerjaaudit” dan nama klien yang diaudit .

Halaman pertama memuat daftar isi, di mana di sudut kanan bawahnyaditulis nama penyusun KKA.

Halaman selanjutnya secara berurutan memuat:

1) daftar simbol audit2) tembusan surat tugas

3) kartu penugasan

4) Jadwal dan anggaran waktu

5) berkas kelompok KKA


77/87

6 - 77

KELOMPOK BESAR BERKAS KKP

BERKAS PERMANEN (PERMANENT FILE)

Berisi informasi yang terus menerus/berulang kalidiperlukan atau pemakaiannya akan diteruskan dalam

tugas yang akan datang.

BERKAS LANCAR (CURRENT FILE)

Terutama memuat bahan informasi yang berhubungandengan kegiatan audit yang dilakukan sekarang dantidak dipertimbangkan untuk dipakai dalam tugasberikutnya.


78/87

6 - 78

Current Files

Audit program

General information

Working trial balance

Adjusting and reclassification entries

Supporting schedules


79/87

6 - 79

Berkas Lancar

Laporan Keuangan dan Standar Kualitas

Hasil Audit

(Konsolidasi)

Laporan Keuangan Klien

Reviu Saldo Awal

Representasi Klien dan Konfirmasi

Rencana Audit Pengujian Pengendalian dan Transaksi

Pengujian Saldo Akun dan Prosedur Analisis

Evaluasi Kelangsungan Hidup Usaha


80/87

Relationship of Audit Documentation


81/87

6 - 81

Relationship of Audit Documentationto Financial Statements

FINANCIAL STATEMENTSCash 122 Acc. ………………….

WORKING TRIALBALANCE

Prelim. AIE’s FinalCash 212 (90) 122

AIE’s Expense 90

Cash 90



82/87

6 - 82


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

Petty Cash A-2 5 5Cash in Bank:General A-3 186 (90) 96Payroll A-4 21 21

212 (90) 122



83/87

6 - 83


A-2CashCount

Sheet

A-3BankReconciliation

A-3/1Confirmation

A-3/2O/S Check List



84/87

6 - 84


A-4BankReconciliation

A-4/1Confirmation

A-4/2O/S Check List

Types of Supporting


85/87

6 - 85

yp pp gSchedules

Analysis

Trial balance

Reconciliation of amountsTests of reasonableness

Summary of procedures

Examination of supporting documentsInformational

Outside documentation


86/87

6 - 86

Audit Documentation

Ownership of audit files

Confidentiality of audit files

Requirements for retention ofaudit documentation


87/87

Documents

D_Audit Respon n Evidence