Auditing & Assurance Services ISE

Höfundar: Timothy Louwers; Penelope Bagley; Allen Blay; Jerry Strawser; Jay Thibodeau (Útgáfa: 10)
Auditing & Assurance Services ISE

Kaup valmöguleikar

As auditors, we are trained to investigate beyond appearances to determine the underlying facts—in other words, to look beneath the surface. Whether evaluating the Enron and World-Com scandals of the early 2000s, the financial crisis of 2007–2008, the Wirecard fraud in 2020 or present-day issues and challenges related to significant estimation uncertainty, understanding the auditor’s responsibility related to fraud, maintaining a clear perspective, probing for details, and understanding the big picture are indispensable to effective auditing.

With the availability of greater levels of qualitative and quantitative information (“Big Data”), the need for technical skills and challenges facing today’s auditor is greater than ever. The Louwers, Bagley, Blay, Strawser, and Thibodeau team has dedicated years of experience in the auditing field to this edition of Auditing & Assurance Services, supplying the necessary investigative tools for future auditors.

Nánar um bókina

Útgefandi
McGraw-Hill Higher Education (International)
ISBN
9781266953026
Print ISBN
9781265273057
Format
ePub
Útgáfa
10
Höfundar
Timothy Louwers; Penelope Bagley; Allen Blay; Jerry Strawser; Jay Thibodeau
Tungumál
English
Útgefið
2026-01-27
Prent takmörkun á líftíma
100
Prent takmörkun
2
Afritunar takmörkun
2

Kaflar

  • Table of Contents and Preface
  • Cover Page
  • Title Page
  • Copyright
  • Dedication
  • Meet the Authors
  • Look Beneath the Surface
  • Cutting-Edge Coverage
  • Flexible Organization
  • Engage Your Students with Real Examples
  • Updated Classroom Cases
  • Fraud Awareness
  • Create a State-of-the-Art Learning Environment: Instructor Resources
  • Standards Update
  • Highlights of Auditing & Assurance Services, 2026 Release
  • New to the Ninth Edition of Auditing & Assurance Services
  • Part I: The Contemporary Auditing Environment
  • Part II: The Financial Statement Audit
  • Part III: Stand-Alone Modules
  • Acknowledgments
  • OUR SINCEREST THANKS. . .
  • A SPECIAL RECOGNITION
  • Connect Feature
  • Brief Contents
  • Contents
  • Chapter 1: Auditing and Assurance Services
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • User Demand for Reliable Information
  • Information Risk in a Big Data World
  • Auditing, Attestation, and Assurance Services
  • Assurance Services
  • Examples of Assurance Services
  • Attestation Engagements
  • Financial Statement Auditing
  • Auditing in Today’s Information Environment
  • Management’s Financial Statement Assertions
  • Existence or Occurrence (Existence, Occurrence, and Cutoff)
  • Completeness (Completeness, Cutoff)
  • Valuation and Allocation (Accuracy, Valuation, and Allocation)
  • Rights and Obligations (Rights and Obligations)
  • Presentation and Disclosure (Classification, Presentation)
  • Importance of Assertions
  • Professional Skepticism
  • Public Accounting
  • Auditing and Assurance Services
  • Tax Services
  • Advisory Services
  • Other Kinds of Engagements and Information Professionals
  • Internal Auditing
  • Governmental Auditing
  • Regulatory Auditors
  • Become a Professional and Get Certified!
  • Education
  • Examination
  • Experience
  • State Certificate and License
  • Skill Sets and Your Education
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Apollo Shoes
  • Chapter 2: Professional Standards
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Generally Accepted Auditing Standards (GAAS)
  • Organization of GAAS
  • Fundamental Principle: Responsibilities
  • Competence and Capabilities
  • Independence and Due Care
  • Professional Skepticism and Professional Judgment
  • Fundamental Principle: Performance
  • Planning and Supervision
  • Materiality
  • Risk Assessment
  • Audit Evidence
  • Fundamental Principle: Reporting
  • Evaluating the Quality of Accounting Firms’ Practices
  • System of Quality Management10
  • PCAOB Inspection of Firms
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Appendix 2A
  • Referencing Professional Standards
  • EXAMPLE: AUDITING REPORTING
  • EXAMPLE: AUDIT CONFIRMATIONS
  • Chapter 3: Engagement Planning and Audit Evidence
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Pre-Engagement Activities
  • Client Acceptance or Continuance
  • Compliance with Independence and Ethical Requirements
  • Engagement Letters
  • Audit Plan
  • Staffing the Audit Engagement
  • Time Budget
  • Materiality
  • Materiality Calculation
  • Other Issues That Impact Materiality
  • How Auditors Use Materiality
  • Audit Procedures for Obtaining Audit Evidence
  • 1. Inspection of Records and Documents
  • 2. Inspection of Tangible Assets
  • 3. Observation
  • 4. Inquiry
  • 5. Confirmation
  • 6. Recalculation
  • 7. Reperformance
  • 8. Analytical Procedures
  • Audit Documentation
  • Permanent Files
  • Current Files
  • Audit Documentation Arrangement and Indexing
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Apollo Shoes
  • Audit Planning
  • Chapter 4: The Audit Risk Model and Inherent Risk Assessment
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Audit Risk
  • Audit Risk
  • Inherent Risk
  • Control Risk
  • Detection Risk
  • Audit Risk Model
  • Fraud Risk
  • Fraud
  • Types of Fraud
  • Inherent Risk Assessment—“What Could Go Wrong?”
  • Understanding the Client’s Business and Its Environment
  • Gathering Information and Preliminary Analytical Procedures
  • General Business Sources
  • Company Sources
  • Information from Client Acceptance or Continuance Evaluation, Audit Planning, Past Audits, and Other Engagements
  • Preliminary Analytical Procedures
  • Audit Team Brainstorming Discussions
  • Inquiry of Audit Committee, Management, and Others within the Company
  • Overall Assessment and Documentation of Inherent Risk Assessment
  • Relevant Assertions
  • Other Considerations
  • Required Documentation
  • Audit Strategy Memorandum
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Data and Analytics
  • Apollo Shoes Preliminary Analytical Procedures
  • Preliminary Analytical Procedures
  • Apollo Shoes Audit Risk Model
  • Audit Risk Model
  • Appendix 4A
  • Selected Financial Ratios
  • Appendix 4B
  • Sample Audit Memorandum
  • OVERVIEW
  • PRODUCT PRICING
  • GOVERNMENT INFLUENCES
  • CUSTOMERS, SUPPLIERS, AND COMPETITORS
  • RISK ASSESSMENT
  • REVENUE AND COLLECTION CYCLE
  • AUDIT APPROACH
  • Chapter 5: Risk Assessment: Internal Control Evaluation
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Definition of Internal Control
  • Internal Control Effectiveness
  • Limitations of Internal Control
  • Management versus Auditors’ Responsibility for Internal Control
  • Management’s Internal Control Responsibilities
  • Auditors’ Internal Control Responsibilities
  • Components of Internal Control
  • Control Environment
  • Risk Assessment
  • Control Activities
  • Information and Communication
  • Monitoring
  • Internal Control Evaluation
  • Phase 1: Understand and Document the Client’s Internal Control System
  • Phase 2: Assessment of Control Risk
  • Phase 3: Identify Controls to Test and Perform Tests of Controls
  • Internal Control Communications
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Data and Analytics
  • Apollo Shoes
  • Internal Control Testing
  • Appendix 5A
  • Audit Plan
  • Chapter 6: Employee Fraud and the Audit of Cash
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • The Need for Skepticism in Audits of Cash
  • Employee Fraud Overview
  • Employee Fraud Red Flags
  • Characteristics of Fraudsters
  • The Fraud Triangle
  • Incentive/Pressure
  • Opportunity
  • Attitude/Rationalization
  • Fraud Prevention
  • Managing People and Pressures in the Workplace
  • Internal Control Activities and Employee Monitoring
  • Tone at the Top
  • The Audit of Cash
  • Management Reports and Data Files in an Audit of Cash
  • Significant Accounts and Relevant Assertions
  • Risk of Material Misstatement
  • Evaluating the Design and Operating Effectiveness of Internal Controls
  • Substantive Procedures
  • “Extended Procedures” to Detect Fraud
  • Schedule of Interbank Transfers
  • Proof of Cash
  • Count and Recount Cash on the Same Day
  • Retrieve Customers’ Checks
  • Use Marked Coins and Currency
  • Analyze the Mix of Cash and Checks in Deposits
  • Measure Deposit Lag Time
  • Document Examination
  • Inquiry
  • Covert Surveillance
  • Horizontal and Vertical Analyses
  • Net Worth Analysis
  • Expenditure Analysis
  • Reasonableness Tests
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Apollo Shoes Cash Audit
  • Audit of the Cash Account
  • Appendix 6A
  • Internal Control Questionnaires
  • Appendix 6B
  • Audit Plans
  • Chapter 7: Revenue And Collection Cycle
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Revenue and Collection Cycle: Typical Activities
  • Receiving and Processing Customer Orders, Including Credit Granting ①
  • Delivering Goods and Services to Customers ②
  • Billing Customers and Accounting for Accounts Receivable ③
  • System-Generated Reports and Data Files in the Revenue and Collection Cycle
  • Significant Accounts and Relevant Assertions
  • Risk of Material Misstatement
  • Revenue Recognition
  • Collectability of Accounts Receivable
  • Customer Returns and Allowances
  • Internal Control Activities and Design Evaluation
  • Entity-Level Controls in the Revenue and Collections Cycle
  • Control Considerations at the Account and Assertion Level
  • Tests of Operating Effectiveness of Internal Control
  • Summary: Control Risk Assessment
  • Substantive Analytical Procedures and Tests of Details
  • Analytical Procedures
  • Confirmation of Accounts and Notes Receivable
  • Alternative Procedures
  • Additional Notes about Confirmations
  • Dual-Purpose Nature of Accounts Receivable Confirmations
  • Review for Collectability
  • Cutoff and Sales Returns
  • Audit Risk Model Applied
  • Healthy Delights Ice Cream Inc.
  • Application in the Field
  • Audit Cases: Extended Audit Procedures
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Data Analytics
  • Apollo Shoes Accounts Receivable Audit
  • Accounts Receivable Audit
  • Appendix 7A
  • Internal Control Questionnaires
  • Appendix 7B
  • Audit Plan
  • Chapter 8: Acquisition And Expenditure Cycle
  • Professional Standards and Learning Objectives
  • Professional Standards Reference
  • Introduction
  • Acquisition and Expenditure Cycle: Typical Activities
  • Purchasing Goods and Services ①
  • Receiving the Goods or Services ②
  • Recording the Asset or Expense and Related Liability ③
  • Significant Accounts and Relevant Assertions
  • Accounts Payable
  • Expenses
  • Risk of Material Misstatement
  • Internal Control Activities and Design Evaluation
  • Entity-Level Controls
  • Control Considerations
  • Custody
  • Periodic Reconciliation
  • Testing of Operating Effectiveness of Internal Control
  • Tests of Controls
  • Substantive Procedures
  • Accounts Payable and the Completeness Assertion
  • Other Expenditure Cycle Accounts
  • Presentation and Disclosure
  • Audit Risk Model Applied
  • Chi-Chi’s Clothing Stores Inc. Example
  • Finding Fraud Signs in Accounts Payable
  • Fraud Cases: Extended Audit Procedures (Isa/As 2301)
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Data Analytics
  • Apollo Shoes Audit of Liabilities
  • Audit of Liabilities
  • Appendix 8A
  • Internal Control Questionnaires
  • Appendix 8B
  • Audit Plans
  • Appendix 8C
  • THE PAYROLL CYCLE
  • The Payroll Cycle: Typical Activities
  • Significant Accounts and Relevant Assertions
  • Internal Control Activities and Evaluation
  • Substantive Analytical Procedures and Tests of Details
  • FRAUD CASE: EXTENDED AUDIT PROCEDURES
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Apollo Shoes Payroll Audit
  • Payroll Audit
  • Chapter 9: The Production Cycle and Auditing Inventory
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Keeping Count
  • Inventory Management: Typical Activities
  • Sales Forecasts and Production Planning
  • Production
  • Cost Accounting
  • Significant Accounts And Relevant Assertions
  • Risk of Material Misstatement
  • Internal Control Activities and Design Evaluation
  • Entity-Level Controls
  • Control Considerations
  • Custody
  • Internal Control Questionnaire
  • Testing of Operating Effectiveness of Internal Control
  • Tests of Controls over Inventory
  • Tests of Controls in a Production Process
  • Direction of Tests of Controls
  • Summary: Control Risk Assessment
  • Substantive Analytical Procedures and Tests of Details
  • Analytical Procedures
  • Substantive Evidence in Management Reports
  • Sales Forecast
  • Inventory Reports
  • Production Plans and Reports
  • Physical Inventory Observation
  • Difficult Inventory Circumstances
  • Audit Risk Model Applied
  • World Electronics LLC
  • Fraud Case: Extended Audit Procedures
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Data Analytics
  • Apollo Shoes Inventory Audit
  • Inventory Audit
  • Appendix 9A
  • Internal Control Questionnaires
  • Appendix 9B
  • Audit Plans
  • Chapter 10: Finance And Investment Cycle
  • Professional Standards References
  • Professional Standards References
  • Introduction
  • Finance and Investment Cycle: Typical Activities
  • Financing the Entity Through Debt and Stockholder Equity
  • Financial Planning ①
  • Raising Capital ②
  • Investing Transactions: Investments and Intangibles ③
  • Significant Accounts and Relevant Assertions
  • Risk of Material Misstatement
  • Complex Transactions
  • Fair Market Value
  • Related-Party Transactions
  • Lease Accounting
  • Loan Covenants
  • Impairments
  • Presentation and Disclosure
  • Internal Control Activities and Design Evaluation
  • Control Considerations
  • Tests of Operating Effectiveness of Internal Control
  • Control over Accounting Estimates
  • Authorization
  • Record Keeping
  • Custody
  • Summary: Control Risk Assessment
  • Substantive Analytical Procedures and Tests of Details
  • Investment Securities
  • Long-Term Liabilities and Related Accounts
  • Stockholders’ Equity
  • Fraud Cases: Extended Audit Procedures (As 2301)
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Appendix 10A
  • Internal Control Questionnaires
  • Appendix 10B
  • Substantive Audit Plans
  • Chapter 11: Completing The Audit
  • Professional Standards and Learning Objectives
  • Introduction
  • Audit Timeline
  • Procedures Performed during Fieldwork
  • Completing Substantive Procedures
  • Attorney Letters
  • Written Representations
  • Ability to Continue as a Going Concern
  • Adjusting Entries and Financial Statement Disclosure
  • Audit Documentation Review
  • Subsequent Events and Subsequently Discovered Facts
  • Subsequent Events
  • Subsequently Discovered Facts
  • Responsibilities Following the Audit Report Release Date
  • Omitted Procedures
  • Communications with Individuals Charged with Governance
  • Management Letter
  • Summary of Audit Communications
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Apollo Shoes Completing the Audit
  • Completing the Audit
  • Chapter 12: Reports On Audited Financial Statements
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Overview of Auditors’ Reports
  • The Standard Report for Nonissuers
  • Types of Opinions
  • Conditions That Require Modifications to the Auditors’ Standard (Unmodified) Report
  • Departures from GAAP5
  • Scope Limitations
  • Audits of Group Financial Statements
  • Auditors’ Reports Referencing Other Matters Encountered during the Audit
  • Consistency
  • “Going-Concern” Uncertainties
  • Other Information Included in Annual Reports
  • Supplementary Information
  • Other Modifications
  • Summary: Emphasis-of-Matter and Other-Matter Paragraphs
  • Comparative Financial Statements
  • Same Auditors, Same Opinions for Comparative Years
  • Same Auditors, Different Opinions for Comparative Years
  • Same Auditors with Modification of Previously Issued Opinion
  • Different Auditors in Comparative Years
  • Other Reporting Topics
  • Special Purpose Frameworks
  • Summary Financial Statements
  • Specified Elements, Accounts, or Items
  • Compliance with Contractual Agreements or Regulatory Requirements
  • Disclaimers of Opinion
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Appendix 12A Auditors’ Reports for Issuers (Public Entities)
  • AUDITORS’ REPORTS FOR ISSUERS (PUBLIC ENTITIES)
  • Key Terms
  • Appendix 12A Exercises and Problems
  • Chapter 12: Reports On Audited Financial Statements (PCAOB Version)
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Overview of Auditors’ Reports
  • The Standard Report for Issuers
  • Types of Opinions
  • Conditions that Require Modifications to the Auditors’ Standard Report
  • Departures from GAAP
  • Scope Limitations
  • Audits of Group Financial Statements
  • Auditors’ Reports Referencing Other Matters Encountered During the Audit
  • Consistency
  • “Going-Concern” Uncertainties
  • Other Information Included with Financial Statements
  • Supplementary Information
  • Other Modifications
  • Summary: Explanatory Paragraphs
  • Other Reporting Topics
  • Comparative Financial Statements
  • Condensed Financial Statements
  • Disclaimers of Opinion
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems PCAOB
  • Module A: Other Public Accounting Services
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Introduction to Attestation Engagements
  • Attestation Engagements
  • Service Organization Control (SOC) Engagements
  • Agreed-Upon Procedures Engagements
  • Prospective Financial Information
  • Compliance Attestation
  • Broker–Dealer Compliance
  • Other Attestation Engagements and Summary
  • Accounting and Review Services for Historical Financial Information
  • Review Engagements
  • Compilation Engagements
  • Preparation Engagement6
  • Summary of Engagements on Historical Financial Information
  • Assurance Services Engagements
  • Environmental, Social, and Governance (ESG)
  • Trust Services
  • The Future of Assurance Services
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Module B: Professional Ethics
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • An Ethical Decision Process
  • Making Ethical Decisions
  • Philosophical Principles in Ethics
  • The Imperative Principle
  • The Principle of Utilitarianism
  • The Generalization Argument
  • Virtue Ethics
  • Ethical Codes of Conduct
  • U.S. Securities and Exchange Commission (SEC)
  • The Public Company Accounting Oversight Board (PCAOB)
  • The International Federation of Accountants (IFAC)
  • The Professional Ethics Executive Committee (PEEC) of the American Institute of CPAs (AICPA)
  • An Emphasis on Independence
  • American Institute of Certified Public Accountants
  • SEC and PCAOB Independence Rules
  • Other Effects of Sarbanes–Oxley on Auditor Independence
  • Government Accountability Office (GAO) Independence Requirements
  • AICPA Rules of Conduct: Integrity and Objectivity, Responsibilities to Clients, and Other Responsibilities
  • Integrity and Objectivity Rule
  • General Standards Rule
  • Compliance with Standards Rule
  • Accounting Principles Rule
  • Acts Discreditable Rule
  • Fees and Other Types of Remuneration
  • Advertising and Other Forms of Solicitation Rule
  • Confidential Client Information Rule
  • Form of Organization and Name Rule
  • Consequences of Violating the Code of Professional Conduct
  • Self-Regulatory Discipline
  • Public Regulation Discipline
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Module C: Legal Liability
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • The Legal Environment
  • Liability Under Common Law
  • Liability to Clients
  • Liability to Third Parties
  • Liability for Compilation and Review Services
  • Liability Under Statutory Law
  • The Securities Act of 1933 (Securities Act)
  • Section 11: Civil Liability
  • Auditors’ Defenses under the Securities Act
  • Section 13: Statute of Limitations
  • Section 17: Antifraud
  • Section 24: Criminal Liability
  • The Securities Exchange Act of 1934 (Securities Exchange Act)
  • Section 10 and Rule 10(b)-5: Antifraud
  • Section 18: Civil Liability
  • Auditors’ Defenses under the Securities Exchange Act
  • Section 32: Criminal Liability
  • Foreign Corrupt Practices Act (FCPA)
  • Summary of Auditors’ Liability to Clients and Third Parties
  • The Changing Landscape of Auditors’ Liability
  • Sarbanes–Oxley
  • Racketeer Influenced and Corrupt Organizations Act
  • Aiding and Abetting
  • Organization of Accounting Firms as Limited Liability Partnerships
  • Proportionate Liability
  • Class-Action Suits
  • Auditors’ Liability Caps
  • Other Developments
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Module D: Internal Audits, Governmental Audits, and Fraud Examinations
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Internal audits, Governmental Audits, and Fraud Examinations
  • Internal Audits
  • Internal Auditing Defined
  • Internal Audit Standards
  • Types of Internal Audit Services
  • Internal Audit Reports
  • Governmental Audits
  • Governmental Auditing Defined
  • Types of Governmental Audits
  • GAO Government Auditing Standards
  • GAO Audit Reports
  • Single Audit Act of 1984 and Amendments of 1996
  • Fraud Examinations
  • The Art of Fraud Examinations
  • Fraud Examiner Responsibilities
  • Building a Fraud Case
  • Protecting the Evidence
  • Obtaining Litigation Support
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Module E: Attributes Sampling
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Planning (Steps 1–3)
  • Step 1: Determine the Objective of Sampling
  • Step 2: Define the Characteristic of Interest
  • Step 3: Define the Population
  • Performing (Steps 4–6)
  • Step 4: Determine the Sample Size
  • Step 5: Select the Sample Items
  • Step 6: Measure the Sample Items
  • Evaluating Sample Results (Step 7)
  • Calculating the Upper Limit Rate of Deviation
  • Making the Evaluation Decision
  • Using IDEA to Evaluate Sample Results
  • Qualitative Evaluation of Deviations
  • Documenting
  • Other Attributes Sampling Methods
  • The Effect of Artificial Intelligence (AI) on Sampling
  • Summary
  • Key Terms
  • Multiple-Choice Questions For Practice And Review
  • Exercises and Problems
  • Data Analytics
  • Appendix EA
  • AICPA Sample Size Tables
  • Appendix EB
  • AICPA Sample Evaluation Tables
  • Module F: Variables Sampling
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Definition of Variables Sampling
  • PPS Sampling: Planning
  • Steps 1–3: Planning
  • PPS Sampling: Performing
  • Step 4: Determine the Sample Size
  • Step 5: Select the Sample Items
  • Step 6: Measure the Sample Items
  • Summary: Performing PPS
  • PPS Sampling: Evaluating
  • Step 7: Evaluating Sample Results
  • Other Variables Sampling Approaches
  • Documentation in Variables Sampling
  • Artificial Intelligence and Audit Sampling
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Data and Analytics
  • Appendix FA
  • AICPA PPS TABLES
  • INTERPOLATING TABLE VALUES IN DETERMINING SAMPLE SIZE
  • Appendix FB
  • CLASSICAL VARIABLES SAMPLING
  • COMPREHENSIVE EXAMPLE: MEAN-PER-UNIT ESTIMATION
  • PPS VERSUS CLASSICAL VARIABLES SAMPLING
  • Key Terms
  • Appendix FB Multiple Choice
  • Appendix FB Exercises and Problems
  • Appendix FC
  • NONSTATISTICAL SAMPLING
  • Key Terms
  • Appendix FC Exercises and Problems
  • Module G: Generative Artificial Intelligence (AI) and Data and Analytics in Auditing
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • The Art of Discovery
  • Audit of the Future
  • Data and Analytics
  • Common Uses of Audit Data Analytics
  • Risk Assessment Procedures
  • Tests of Controls
  • Substantive Analytical Procedures
  • Tests of Details
  • Conducting Audit Data Analytics
  • Plan the ADA
  • Access and Prepare the Data
  • Consider the Relevance and Reliability of the Data
  • Perform the ADA
  • Evaluate the Results and Draw Conclusions
  • Documentation Requirements
  • Common Tools Used in ADA
  • Professional Skepticism in ADA
  • Generative Artifical Intelligence
  • Understanding Generative AI’s Capabilities and Limitations
  • Using Generative AI Tools Effectively and Efficiently
  • Evaluate and Validate Generative AI Inputs and Outputs
  • Using Generative AI Responsibly and Ethically
  • Enhance Soft Skills and Mindsets for a Generative AI World
  • Critical Thinking
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Data Analytics
  • Module H: Information Technology Auditing
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Automated Transaction Processing
  • Reliance on Information Technology Controls
  • Scoping the IT Audit Procedures
  • Understanding the Types of IT Control Activities
  • Information Technology General Controls
  • Access to Programs and Data Controls
  • Program Change Controls
  • Computer Operations Controls
  • Program Development Controls
  • Overall Summary
  • Automated Application Controls
  • Input Controls
  • Processing Controls
  • Output Controls
  • Summary
  • Assessing Control Risk in an IT Environment
  • Testing Controls in an IT Environment
  • End-User Computing and Other Environments
  • End-User Computing Control Considerations
  • Computer Abuse and Computer Fraud
  • Preventive, Detective, and Damage-Limiting Controls
  • Computer Forensics
  • Summary
  • Key Terms
  • Multiple-Choice Questions for Practice and Review
  • Exercises and Problems
  • Module I: The Audit of Internal Control For Issuers
  • Professional Standards and Learning Objectives
  • Professional Standards References
  • Introduction
  • Laws Regulations & Standards
  • Effectiveness of Internal Control
  • Management’s Responsibility
  • Auditors’ Responsibilities
  • The Audit of Internal Control Over Financial Reporting
  • Components of Internal Control over Financial Reporting
  • Performing The Audit
  • Audit Planning
  • Testing Design and Operating Effectiveness
  • Evaluating Identified Deficiencies
  • Severity of Deficiency
  • Compensating Controls
  • Communicating the Results of the Audit
  • Communicating Significant Deficiencies and Material Weakness
  • Audit Reporting
  • Auditors’ Separate Report on Internal Control Over Financial Reporting
  • Modifications to the Standard Report
  • Summary
  • Key Terms
  • Multiple-Choice Questions For Practice and Review
  • Exercises and Problems
  • Apollo Shoes
  • Auditor’s Report on the Financial Statements and Internal Controls Over Financial Reporting
  • Cases
  • Andersen: An Obstruction of Justice?
  • Andersen: An Obstruction of Justice?
  • CONCLUSION
  • DISCUSSION QUESTIONS
  • PTL Club–The Harbinger of Things to Come?
  • TROUBLE IN PARADISE
  • WHERE WAS THE OVERSIGHT?
  • WHAT DID THE AUDITORS KNOW?
  • AFTER THE FALL
  • LAVENTHOL & HORWATH
  • GOING TO COURT
  • CONCLUSION
  • Additional Information
  • DISCUSSION QUESTIONS
  • ADDITIONAL SOURCES
  • GM: Running on Empty?
  • GM’S REORGANIZATION
  • A BOOST FOR THE AUTO INDUSTRY
  • EPILOGUE
  • DISCUSSION QUESTIONS
  • Unhealthy Accounting at HealthSouth
  • PROBLEM
  • AUDIT APPROACH
  • DISCOVERY
  • DISCUSSION QUESTIONS
  • KPMG: How Many Firms?
  • BACKGROUND
  • THE PROBLEM
  • THE OUTCOME
  • THE ISSUE
  • EPILOGUE
  • DISCUSSION QUESTIONS
  • Something Went Sour at Parmalat
  • PROBLEM
  • AUDIT APPROACH
  • DISCOVERY
  • DISCUSSION QUESTIONS
  • GE: How Much Are Auditors Paid?
  • BACKGROUND
  • HOW DID SARBANES–OXLEY AFFECT ACCOUNTING FIRM REVENUES?
  • SEC-REQUIRED FEE DISCLOSURES
  • GE’S AUDITOR CHANGE
  • DISCUSSION QUESTIONS
  • Satyam Computer Services
  • HISTORY OF SATYAM
  • INDIAN ACCOUNTING ENVIRONMENT
  • THE FRAUD
  • THE AUDITORS
  • FOLLOW-UP
  • DISCUSSION QUESTIONS
  • ADDITIONAL SOURCES
  • Daily Journal Corporation
  • REPORTING DELAYS
  • DISMISSAL OF EY
  • APPOINTMENT OF BDO USA, LLP
  • SEC COMMENT LETTER
  • ANOTHER AUDITOR CHANGE
  • CONCLUSION
  • DISCUSSION QUESTIONS
  • London Has Fallen
  • DISCUSSION QUESTIONS
  • Lehman Brothers: Subprime Accounting?
  • SUBPRIME LENDING
  • A SOLUTION: INFLATED ASSET VALUATIONS
  • A LESS TRANSPARENT SOLUTION: REPO 105
  • WHERE WERE THE AUDITORS?
  • THE AFTERMATH
  • DISCUSSION QUESTIONS
  • ADDITIONAL SOURCES
  • Bernard L. Madoff: The Fraud of the Century
  • PONZI SCHEME
  • SPLIT-STRIKE CONVERSION STRATEGY
  • SECURITIES AND EXCHANGE COMMISSION
  • MADOFF’S AUDITOR
  • DISCUSSION QUESTIONS
  • When the Music Stops: Crazy Eddie’s
  • Background
  • The Hide and Seek of the Audit
  • Conclusion
  • Discussion Questions
  • Sources
  • Audit Standards
  • Audit Standards
  • Index
  • Index
  • A
  • B
  • C
  • D
  • E
  • F
  • G
  • H
  • I
  • J
  • K
  • L
  • M
  • N
  • O
  • P
  • Q
  • R
  • S
  • T
  • U
  • V
  • W
  • X
  • Y
  • Z
  • Additional Student Resources
  • Student Resources
  • Text Alternatives for Images
  • Exhibit 1.3 Extended Description (Chapter 1)
  • Exhibit 1.5 Extended Description (Chapter 1)
  • Exhibit 1.6 Extended Description (Chapter 1)
  • Unnumbered Exhibit 2.1 Extended Description (Chapter 2)
  • Unnumbered Exhibit 2.2 Extended Description (Chapter 2)
  • Unnumbered Exhibit 2.3 Extended Description (Chapter 2)
  • Unnumbered Exhibit 2.4 Extended Description (Chapter 2)
  • Unnumbered Exhibit 2.5 Extended Description (Chapter 2)
  • Unnumbered Exhibit 2.6 Extended Description (Chapter 2)
  • Unnumbered Exhibit 2.7 Extended Description (Chapter 2)
  • Exhibit 2.1 Extended Description (Chapter 2)
  • Unnumbered Exhibit 2.8 Extended Description (Chapter 2)
  • Unnumbered Exhibit 2.9 Extended Description (Chapter 2)
  • Exhibit 3.1 Extended Description (Chapter 3)
  • Exhibit 3.4 Extended Description (Chapter 3)
  • Exhibit 3.5 Extended Description (Chapter 3)
  • Exhibit 3.7A Extended Description (Chapter 3)
  • Exhibit 3.7B Extended Description (Chapter 3)
  • Unnumbered Exhibit 3.1 Extended Description (Chapter 3)
  • Exhibit 3.8 Extended Description (Chapter 3)
  • Exhibit 3.9 Extended Description (Chapter 3)
  • Exhibit 4.1 Extended Description (Chapter 4)
  • Exhibit 4.2 Extended Description (Chapter 4)
  • Exhibit 4.3 Extended Description (Chapter 4)
  • Exhibit 4.4 Extended Description (Chapter 4)
  • Exhibit 4.6 Extended Description (Chapter 4)
  • Exhibit 4.8 Extended Description (Chapter 4)
  • Exhibit 5.2 Extended Description (Chapter 5)
  • Exhibit 5.5 Extended Description (Chapter 5)
  • Exhibit 5.6 Extended Description (Chapter 5)
  • Unnumbered Exhibit 5.1 Extended Description (Chapter 5)
  • Exhibit 5.7 Extended Description (Chapter 5)
  • Exhibit 5.9 Extended Description (Chapter 5)
  • Unnumbered Exhibit 5.2 Extended Description (Chapter 5)
  • Unnumbered Exhibit 5.3 Extended Description (Chapter 5)
  • Exhibit 5.13 Extended Description (Chapter 5)
  • Exhibit 6.1 Extended Description (Chapter 6)
  • Exhibit 6.2 Extended Description (Chapter 6)
  • Exhibit 6.3 Extended Description (Chapter 6)
  • Exhibit 6.7 Extended Description (Chapter 6)
  • Exhibit 6.11 Extended Description (Chapter 6)
  • Exhibit 6.12 Extended Description (Chapter 6)
  • Exhibit 7.1 Extended Description (Chapter 7)
  • Exhibit 7.2 Extended Description (Chapter 7)
  • Exhibit 7.7 Extended Description (Chapter 7)
  • Exhibit 7.11 Extended Description (Chapter 7)
  • Exhibit 7.12 Extended Description (Chapter 7)
  • Exhibit 7.13 Extended Description (Chapter 7)
  • Exhibit 8.1 Extended Description (Chapter 8)
  • LO 8-2 Extended Description (Chapter 8)
  • Exhibit 8.8 Extended Description (Chapter 8)
  • LO 8-6 Extended Description (Chapter 8)
  • Exhibit 8C.1 Extended Description (Chapter 8)
  • Unnumbered Exhibit 8.1 Extended Description (Chapter 8)
  • Exhibit 9.1 Extended Description (Chapter 9)
  • LO 9-2 Extended Description (Chapter 9)
  • Exhibit 9.9 Extended Description (Chapter 9)
  • Exhibit 9.10 Extended Description (Chapter 9)
  • Unnumbered Exhibit 9.1 Extended Description (Chapter 9)
  • Exhibit 10.2 Extended Description (Chapter 10)
  • Exhibit 11.1 Extended Description (Chapter 11)
  • Exhibit F11.1 Extended Description (Chapter 11)
  • Exhibit F11.2 Extended Description (Chapter 11)
  • Exhibit 12.2 Extended Description (Chapter 12)
  • Exhibit 12.5 Extended Description (Chapter 12)
  • Exhibit 12.8 Extended Description (Chapter 12)
  • Unnumbered Exhibit 12.9 Extended Description (Chapter 12)
  • Exhibit 12.2 Extended Description (Chapter 12)
  • Exhibit 12.5 Extended Description (Chapter 12)
  • Exhibit 12.8 Extended Description (Chapter 12)
  • Unnumbered Exhibit 12.9 Extended Description (Chapter 12)
  • Exhibit 12.11 Extended Description (Chapter 12)
  • Unnumbered Exhibit A.1 Extended Description (Module A)
  • Exhibit B.3 Extended Description (Module B)
  • Unnumbered Exhibit B.2 Extended Description (Module B)
  • Unnumbered Exhibit B.1 Extended Description (Module B)
  • Unnumbered Exhibit C.1 Extended Description (Module C)
  • Exhibit C.1 Extended Description (Module C)
  • Unnumbered Exhibit C.2 Extended Description (Module C)
  • Exhibit D.2 Extended Description (Module D)
  • Unnumbered Exhibit E.1 Extended Description (Module E)
  • Unnumbered Exhibit E.2 Extended Description (Module E)
  • Unnumbered Exhibit E.3 Extended Description (Module E)
  • Unnumbered Exhibit E.4 Extended Description (Module E)
  • Unnumbered Exhibit E.5 Extended Description (Module E)
  • Unnumbered Exhibit E.6 Extended Description (Module E)
  • Unnumbered Exhibit E.7 Extended Description (Module E)
  • Unnumbered Exhibit E.8 Extended Description (Module E)
  • Unnumbered Exhibit F.1 Extended Description (Module F)
  • Unnumbered Exhibit F.2 Extended Description (Module F)
  • Unnumbered Exhibit F.3 Extended Description (Module F)
  • Unnumbered Exhibit F.4 Extended Description (Module F)
  • Unnumbered Exhibit F.5 Extended Description (Module F)
  • Unnumbered Exhibit F.6 Extended Description (Module F)
  • Unnumbered Exhibit F.7 Extended Description (Module F)
  • Exhibit G.2 Extended Description (Module G)
  • Exhibit G.3 Extended Description (Module G)
  • Exhibit G.4 Extended Description (Module G)
  • Exhibit G.5 Extended Description (Module G)
  • Exhibit G.6 Extended Description (Module G)
  • Exhibit G.7 Extended Description (Module G)
  • Exhibit G.7 Extended Description (Module G)
  • Exhibit G.7 Extended Description (Module G)
  • Exhibit G.8 Extended Description (Module G)
  • Exhibit G.9 Extended Description (Module G)
  • Unnumbered Exhibit G.1 Extended Description (Module G)
  • Exhibit H.1 Extended Description (Module H)
  • Exhibit H.2 Extended Description (Module H)
  • Unnumbered Exhibit H.2 Extended Description (Module H)
  • Unnumbered Exhibit H.1 Extended Description (Module H)
  • Exhibit I.8 Extended Description (Module I)
  • Gm Exhibit 2 Extended Description (Cases)
  • Unnumbered Exhibit 1 Extended Description (Audit Standards)
  • Unnumbered Exhibit 2 Extended Description (Audit Standards)
  • Unnumbered Exhibit 3 Extended Description (Audit Standards)
  • Unnumbered Exhibit 4 Extended Description (Audit Standards)
  • Unnumbered Exhibit 5 Extended Description (Audit Standards)