AUD - Formula Sheethttp://www.cpa-cfa.org

What are the GAAS? -

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What are the main sections and content of an Unqualified opinion (Standard report)?Addressee________________ Paragraph –

_____________ Paragraph –

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AUD - Formula Sheethttp://www.cpa-cfa.org

_____________ Paragraph

GAAS in referenced _____________________ paragraph

GAAP is referenced _____________________ paragraph

Draw Opinion Chart

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AUD - Formula Sheethttp://www.cpa-cfa.org

What matters can an auditor emphasize but still express an unqualified opinion?

An explanatory paragraph is _____________

When updating (changing prior) periods the explanatory paragraph should disclose the:

What are the five interrelated elements of quality control?

What should be included in the compilation engagement report?

3

AUD - Formula Sheethttp://www.cpa-cfa.org

What should be included in the review engagement report?

Reviews of interim F/S of a public company are conducted in accordance with_____________________________

In a comfort letter to underwriters Provide positive assurance on:

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But provide negative assurance on:

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Financial forecasts –

Financial projection –

An engagement letter –

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AUD - Formula Sheethttp://www.cpa-cfa.org

Define audit risk and detail the formula and define its components-

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Define the significant relationships

What are the audit procedures?

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AUD - Formula Sheethttp://www.cpa-cfa.org

What are the F/S Assertions (made by mgmt)?

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Errors –

Fraud –

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AUD - Formula Sheethttp://www.cpa-cfa.org

What are the Audit Steps for internal controls? _______________

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What are the five components of internal controls? ___________________ Draw the diagram

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Audit approach (Fill in)Status of internal control Risk level Perform control tests Perform substantive tests

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AUD - Formula Sheethttp://www.cpa-cfa.org

3.

What is substantive testing used for?

What are the 2 types of substantive procedures?

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2.

Vouching –

Tracing –

Sampling risk –

What are the 2 main types of sampling?

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2.

Audit risk –

Risk of assessing control risk too low –

Risk of assessing control risk too high –

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AUD - Formula Sheethttp://www.cpa-cfa.org

What are the two types of mistakes an auditor can make with sampling:

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2.

Describe the effectiveness of an audit

Describe the efficiency of an audit

Tolerable deviation rate -

Deviation rate –

Population of 1000 and sample 100 items and 7 deviations identified within the sample:

What is the sample deviation rate? ___________

What estimate of deviations in the populations are there? _____________

A5-10,11,12 good sample size example and how to evaluate the sample results. Memorize

Sample Size relationship to:

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AUD - Formula Sheethttp://www.cpa-cfa.org

Incorrect acceptance:

Variability:

Tolerable Misstatement:

Define and describe the upper deviation rate

Upper deviation rate =

Allowance for sampling risk –

Tolerable misstatement –

A5-20,21 good examples memorize

Projected Error =

Test data (test deck) –

Integrated test facility (ITF) –

Parallel simulation (reperformance test) –

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AUD - Formula Sheethttp://www.cpa-cfa.org

The current ratio =

The quick ratio =

The accounts receivable turnover =

The inventory turnover =

Total asset turnover =

Gross margin percentage =

Net operating margin percentage =

Times interest earned =

Total debt to equity percentage =

Return on equity =

Return on assets =

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