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HI6026 - Audit, Assurance and Compliance Report

10 Pages2357 Words106 Views
   

Holmes Institute Sydney

   

Audit, Assurance and Compliance (HI6026)

   

Added on  2020-03-07

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This report will help in investigating identified fluctuation or relationship data inconsistent with other information. This preliminary analytical review is performed to obtain to create an understanding of the business and its environment to determine the nature and assess the risk of material misstatement to determine the timing of the audit procedure and to develop an audit strategy and program.

HI6026 - Audit, Assurance and Compliance Report

   

Holmes Institute Sydney

   

Audit, Assurance and Compliance (HI6026)

   Added on 2020-03-07

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Audit, Assurance, and ComplianceINDIVIDUAL ASSIGNMENT 11 | P a g e
HI6026 - Audit, Assurance and Compliance Report_1
Table of ContentsSolution 1.........................................................................................................................................3Solution 2.........................................................................................................................................6Solution 3.........................................................................................................................................8References......................................................................................................................................102 | P a g e
HI6026 - Audit, Assurance and Compliance Report_2
Solution 1The analytical procedure is an effective tool used by the auditor to perform risk assessment andidentification of misstatement in the financial statement. The process consists of an evaluation ofthe financial information through analyzing the relationship between financial and non-financialdata. It helps in investigating identified fluctuation or relationship data inconsistent with otherinformation (Knechel & Salterio, 2016). The procedure is used throughout the audit process andis conducted for three purposes which are a preliminary analytical review, substantive analyticalreview, and final analytical review. The preliminary analytical review is performed to obtain to create an understanding of thebusiness and its environment to determine the nature and assess the risk of material misstatementto determine the timing of audit procedure and developing audit strategy and program. Thesubstantive is used when the auditor considers that the transaction is to be examined in details toreduce the risk of material misstatement at the assertion level. The final analytical reviewexamines the overall financial statement at the end of the audit process to check that they areconsistent with auditor understanding of entity (Parker, et. al., 2013). The process is followedwhen any irregularities are found and to overcome the same with the detailed examination. TheAuditor generally makes the choice of the audit procedure on the basis of internal control system.If the Auditor of the DIPL finds that the internal control system of the company is weak thenthey have to widen the scope of the audit and make the use of the different process to detectfraud. On the other hand, if the auditor finds that the company is having strong internal controlsystem than they can limit the scope of their audit. The order of DIPL needs to identify the audit procedure which will hold in a detailedexamination of the financial statement. The process will help in obtaining the evidence to checkthe authenticity of the financial statement and create a relationship between financial and non-financial data. The process involved comparing the data of past year and identifies the trend tocheck the authenticity of the financial statement.The Analytical procedure will help the auditor of the DIPL to identify fraud and error in thefinancial statement and make proper reporting over the same. So the auditor while framing the3 | P a g e
HI6026 - Audit, Assurance and Compliance Report_3

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