STARRY GOLD ACADEMY

INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA

PROFESSIONAL EXAMINATION ONE – ADVANCED

AUDITING & ASSURANCE

SECTION ONE: AUDIT PLANNING AND CONTROL

Development of Audit Strategy:

- Determination and uses of quantitative and

qualitative

materiality considerations.

- Multiple location and consolidated organisation

considerations.

- Audit Plans and Planning Memorandum.

- Factors for consideration in Audit Planning.

Determination of Audit Risks:

- Inherent risks.

- Control risks.

- Detection risks.

Execution of Audit Strategy:

- Documentation and assessment of control systems.

- Nature, extent and timing of audit procedures.

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Organising, audit working papers and working with

specialist reports.

REVIEW QUESTIONS

1. Enumerate factors to consider when planning an

audit

2. List the content of an audit planning

memorandum

3. Outline the qualities of good working papers

4. Distinguish between audit strategy, audit program

and audit integrity checklist or audit completion

checklist.

5. L.ist the content of current audit file.

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SECTION TWO: ISSUES IN AUDIT PRACTICE

Organisation and Conduct of Professional Office:

- Office and office facilities

- Partners relationship

- Staff and management

- Quality control

- Training

Standards for Assurance Engagement:

- Definition and underlying concept of assurance

engagement

- Quality control practices and procedures,

advertising and publicity, fees, tendering,

engagement letters and consultation

- Performance and reporting standards

Appraisal of Expectation Gap, Responsibilities for

Fraud Detection,

Prevention, Reporting Errors, Omissions,

Misstatements and Other

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Irregularities etc.

Negotiation skills

Auditors‟ liability

REVIEW QUESTIONS

1. Enumerate the functions of the staff partner

2. List the general quality control procedures by the

firm

3. Mention the types of assurance engagement and list

the examples of assurance engagement other than

statutory audit.

4. Enumerate the contents of an engagement letter

5. Identify the two types of bargaining, outline a

normal bargaining process

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SECTION THREE: PUBLIC SECTOR AUDIT

Audit of Corporations and Parastatals.

Specialised Audits: Contracts, Pensions, Defence and

Security Agencies,

Audit of Nigerian Foreign Missions and Agencies.

Value-for-money Audit.

Investigations: Uses of Probe Panels in Investigating

Acts of Fraud and Corruption.

Due process review

Audit of Government Accounts (Federal, States and

Local Governments).

REVIEW QUESTIONS

1. Enumerate the functions of Auditor-General for the

federation

2. Outline the departments under the office of the

auditor-general for the federation

3. List the congent areas of audit in a public sector

audit.

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4. Define Value for money audit, identify its elements

and mention the areas of concern

5. What are the types of public sector audit and list the

documents obtainable for a regulatory audit.

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SECTION FOUR - SPECIALISED AUDITS AND

INVESTIGATIONS

Understanding of special features of certain types of

situations peculiar to:

- farmers, professionals, hospitals, hotels, etc.

- forensic investigation and reporting.

- banks, insurance companies, primary mortgage

institutions, etc.

- not-for profit‟ organizations – Charities, NGO‟s,

etc.

Joint Audits.

Investigations

- Distinction between auditing and investigation.

- Nature, classes and methods of investigation.

- Auditors‟ involvement with prospectuses and

other offer documents.

- Examination of financial forecasts and

projections.

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- The report appropriate to each type of

investigation.

Insolvency and Business Recovery

- Various legal processes involved in corporate

distress.

- Differences between receivership,

receiver/manager, bankruptcy and liquidation

- Implications of insolvency for corporate

governance and ‘’going concern‟ threats.

- Legal requirements

- Handling insolvency assignments.

Due diligence reviews for mergers, acquisitions

and business combinations.

REVIEW QUESTIONS

1. Explain the peculiarities of Joint audit

2. List the steps under specific approach for

specialized audits and investigations.

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3. Enumerate the peculiar guidelines for the audit of

banks.

4. Enumerate the specific requirements for the audit

of insurance companies

5. Distinguish between auditing and investigation,

then list the various classes of investigation.

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SECTION FIVE: PRINCIPLES AND APPLICATIONS OF

PROFESSIONAL ETHICS

The nature of ethics; differentiation between

philosophical and professional approaches.

Concepts of integrity, obligation, independence,

public expectations.

Ethics and the professions; social responsibility.

Ethics and the law.

Consequences of unethical behaviour to the

individuals, the professions and the society at

large.

Ethical standards and professional responsibilities,

independence, confidentiality, objectivity,

securing professional work, consultancy,

succession arrangement, disciplinary procedures,

compliance with standards and development.

Relationship with fellow members, joint

engagements, communication with predecessors,

special assignments and other assurance services.

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Corporate Governance: Concepts and

Applications

- auditors‟ responsibility in relation to

shareholder information and participation

rights.

- the duties and organisations of the Board of

Directors and the Management

- systems of checks and balances.

Obligation should change to objectivity.

REVIEW QUESTIONS

1. Define Ethics and explain the three fundamental

ethical principles

2. Enumerate the characteristics of a profession

3. Explain the relationships between Ethics and Law

4. Outline the ethical rules of auditor’s independence

5. What is Corporate Governance, explain the

expected roles of the auditor.

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SECTION SIX: LOCAL AND INTERNATIONAL

LEGISLATIONS AFFECTING AUDITS

Economic and Financial Crimes Commission

(EFCC) Act

Independent, Corrupt Practices and Other

Related Offences Commission (ICPC) Act

Sarbanes-Oxley Act and other relevant

international legislations.

REVIEW QUESTIONS

1. Mention 5 other laws in Nigeria that EFCC

enforces.

2. Differentiate between the EFCC Act of 2004 and

the ICPC Act of 2001

3. Enumerate the functions of ICPC

4. Describe the provisions of Sarbanes-Oxley Act

5. List the requirements for the approval of

auditors for quoted companies

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SECTION SEVEN: QUALITY CONTROL IN AUDIT AND

ASSURANCE REPORTS

Effects of SAS, NSA and IFRS on Audit Reports.

Statutory Audit Reports:

- Supervisor‟s Review.

- Manager‟s Review.

- Partner‟s Review.

- External/Peer Group Review.

- Hot/Quality Control Appraisal.

Reports to Management.

Reports on Assurance assignments.

REVIEW QUESTIONS

1. Describe the effects of NSA, ISA, SAS & IFRS on

audit report

2. Distinguish between internal and external

review

3. Differentiate between hot and cold review

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4. List the contents of a management letter

5. Explain the factors that affects the qualification

of auditors reports.

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SECTION EIGHT: EMERGING ISSUES IN AUDIT AND

ASSURANCE

Transnational audits.

Environmental and social audits.

REVIEW QUESTIONS

1. Explain the concept of transnational audit

2. Enumerate the procedures for environmental and

social audit

3. List and briefly explain 5 fundamental emerging

issues

4. Describe the provisions of SARBANES OXLEY Act.

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SECTION NINE: INFORMATION TECHNOLOGY ISSUES IN

AUDIT AND ASSURANCE

IT general controls environment.

IT governance.

IT control activities.

Systems evaluation & procedural controls.

IT risk assessment methodologies and

processes.

Disaster recovery.

Auditor‟s role in Systems Development Life

Cycle (SDLC).

REVIEW QUESTIONS

1. Distinguish between IT & ICT and enumerate IT

general controls environment

2. Define IT governance and mention IT control

activities

3. Describe IT risk assessment methodologies and

processes

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4. What is Disaster recovery and enumerate the

various methods available

5. Explain the auditor’s role in System Development

Life Cycle (SDLC).