Audit Fraud & error p7
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The document discusses the differences and relationships between fraud and error in accounting. It notes that fraud is intentional while error can occur due to misinterpretation or incorrect accounting. Management has primary responsibility for preventing and detecting fraud and establishing proper internal controls and corporate governance. Auditors are responsible for obtaining reasonable assurance about whether the financial statements are free of material misstatement due to fraud or error. If fraud is suspected, auditors should perform additional testing, discuss with management, and consider reporting and legal impacts. The document also covers auditor responsibilities and potential criminal and civil liabilities related to negligence.
Audit Fraud & error p7
- 2. Fraud v Error Intentional
- 4. Fraud v Error Intentional Misinterpretation
- 5. Fraud v Error Intentional Misinterpretation
- 6. Fraud v Error Intentional Misinterpretation Incorrect Accounting
- 7. Fraud v Error Intentional Misinterpretation Incorrect Accounting
- 8. Fraud v Error Intentional Misinterpretation Incorrect Accounting There may be requirements to report suspicions of fraud, but not error
- 10. Management v Auditor Prepare T&F
- 11. Management v Auditor Prepare T&F
- 12. Management v Auditor Prepare T&F Prevent & Detect Fraud
- 13. Management v Auditor Prepare T&F Prevent & Detect Fraud
- 14. Management v Auditor Prepare T&F Prevent & Detect Fraud Internal Controls
- 15. Management v Auditor Prepare T&F Prevent & Detect Fraud Internal Controls Good Corporate Governance
- 17. Management v Auditor Report on T&F
- 18. Management v Auditor Report on T&F
- 19. Management v Auditor Report on T&F Reasonable Assurance Fraud & ERROR
- 20. Management v Auditor Report on T&F Reasonable Assurance Fraud & ERROR
- 21. Management v Auditor Report on T&F Reasonable Assurance Fraud & ERROR Primary F&E responsibility lies with management
- 22. Management v Auditor Report on T&F Reasonable Assurance Fraud & ERROR Primary F&E responsibility lies with management consider the risk of material misstatement
- 24. Management v Auditor Reduce fraud opportunities
- 25. Management v Auditor Reduce fraud opportunities Establish a culture where no fraud
- 26. Management v Auditor Reduce fraud opportunities Establish a culture where no fraud due to the likelihood of detection
- 28. Professional Scepticism Discuss fraud within specific characteristics of the audit & potential effect on FS
- 29. Professional Scepticism Discuss fraud within specific characteristics of the audit & potential effect on FS
- 30. Professional Scepticism Discuss fraud within specific characteristics of the audit & potential effect on FS Talk to management about controls to detect or prevent fraud
- 31. Professional Scepticism Discuss fraud within specific characteristics of the audit & potential effect on FS Talk to management about controls to detect or prevent fraud Obtain evidence that fraud has not occurred or detected and corrected
- 34. Fraud/Error is Suspected? Effect on FS?
- 35. Fraud/Error is Suspected? Effect on FS?
- 36. Fraud/Error is Suspected? Effect on FS? Document in Audit files
- 37. Fraud/Error is Suspected? Effect on FS? Document in Audit files
- 38. Fraud/Error is Suspected? Effect on FS? Additional Document in Testing? Audit files
- 39. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Additional Document in Testing? Audit files
- 40. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Additional Document in Testing? Audit files
- 41. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files
- 42. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files
- 43. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files Discuss with Management
- 44. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files Discuss with Management Tell them to get legal advice if fraud is suspected
- 45. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files Discuss with Management Tell them to get legal advice if fraud is suspected
- 46. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files Discuss with If Management Management Tell them to get Suspected? legal advice if fraud is suspected
- 47. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files Discuss with If Management Management Tell them to get Suspected? legal Get legal advice or rarely resign advice if fraud is suspected
- 48. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files Discuss with If Management Management Tell them to get Suspected? legal Get legal advice or rarely resign advice if fraud is suspected
- 49. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files Consider Discuss with If Management Report Management Tell them to get Suspected? Impact legal Get legal advice or rarely resign advice if fraud is suspected
- 50. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files Consider Discuss with If Management Report Management Tell them to get Suspected? Impact legal Get legal advice or rarely resign advice if fraud is suspected
- 51. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files Consider Discuss with If Management Report Management Tell them to get Suspected? Impact legal Get legal advice or rarely resign advice if fraud is suspected Report to Authorities?
- 52. Fraud/Error is Suspected? Effect on FS? Extent of misstatement Effect on Additional Document in Risk? Testing? Audit files Consider Discuss with If Management Report Management Tell them to get Suspected? Impact legal Get legal advice or rarely resign advice if fraud is suspected Report to Authorities? Consider Confidentiality
- 53. The Auditor - Criminal Liability
- 54. The Auditor - Criminal Liability Accepting appointment without being qualified
- 55. The Auditor - Criminal Liability Accepting appointment without being qualified Being involved with fraud
- 56. The Auditor - Criminal Liability Accepting appointment without being qualified Being involved with fraud Insider Dealing
- 57. The Auditor - Criminal Liability Accepting appointment without being qualified Being involved with fraud Insider Dealing Money Laundering
- 58. The Auditor - Civil Liability
- 59. The Auditor - Civil Liability Negligent (careless) auditing
- 60. The Auditor - Civil Liability Negligent (careless) auditing Sued by Client company under contract law
- 61. The Auditor - Civil Liability Negligent (careless) auditing Sued by Client company under contract law Sued by banks etc under negligence
- 62. The Auditor - Duty of skill & Care
- 63. The Auditor - Duty of skill & Care Depends on the circumstance
- 64. The Auditor - Duty of skill & Care Depends on the circumstance eg. Accepting the word of management after suspicion is aroused
- 65. The Auditor - Duty of skill & Care Depends on the circumstance eg. Accepting the word of management after suspicion is aroused Follow ISAs and show this in working papers
- 66. The Auditor - Professional competence
- 67. The Auditor - Professional competence Achieve, and maintain, professional knowledge
- 68. The Auditor - Professional competence Achieve, and maintain, professional knowledge eg. Formal & Informal training + experience
- 69. The Auditor - Professional competence Achieve, and maintain, professional knowledge eg. Formal & Informal training + experience Awareness of general business developments, such as dropbox and e-commerce
- 70. The Auditor - Due care
- 71. The Auditor - Due care Acting diligently in accordance with technical and professional standards
- 72. The Auditor - Due care Acting diligently in accordance with technical and professional standards means applying knowledge minimising the chance of mistakes being made
- 73. The Auditor - Due care Acting diligently in accordance with technical and professional standards means applying knowledge minimising the chance of mistakes being made Enough time to complete work with due care Staff fully understand the objectives
- 74. The Auditor - Negligence - A Civil Wrong
- 75. The Auditor - Negligence - A Civil Wrong Duty of Care
- 76. The Auditor - Negligence - A Civil Wrong Duty of Care Duty is broken
- 77. The Auditor - Negligence - A Civil Wrong Duty of Care Duty is broken Damage results
- 78. The Auditor - Negligence - A Civil Wrong Duty of Care Duty is broken Damage results The auditor does not exist to aid investment decisions, unless verbal assurances given
- 80. Fraudulent Financial Reporting Intentional Misstatement!
- 82. Fraudulent Financial Reporting Manipulation
- 83. Fraudulent Financial Reporting Manipulation Misrepresentation
- 84. Fraudulent Financial Reporting Manipulation Misrepresentation Misapplication
- 85. Fraudulent Financial Reporting Manipulation Misrepresentation Misapplication Earnings Management
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