Jenis Audit, Tujuan Audit, dan Laporan Audit

(From Arens PPT, modified)

Session #1
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Learning Objective 1

Describe auditing.

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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The Need and Relationships

Client or audit committee hires auditor, required by law or users

Auditor

Auditor issues report relied upon by users, provide assurance

Client

Users use reports, for decision making, e.g. investment, face risk Client reports to users

External Users

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Nature of Auditing
Auditing is the accumulation and evaluation of evidence about information to determine and report on the degree of correspondence

between the information and established criteria.

Auditing should be done by a competent, independent person.
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Information and Established Criteria

To do an audit, there must be information in a verifiable form and some standards (criteria) by which the auditor can evaluate the information.

Accumulating Evidence and Evaluating Evidence

Evidence is any information used by the auditor to determine whether the information being audited is stated in accordance with the established criteria.
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Competent, Independent Person

Auditor must be qualified to understand the criteria used and must be competent to know the types and amount of evidence to accum. to reach the proper conclusion after evidence has been examined.

The competence of the individual performing audit is of little value if he/she is biased in the accumulation and evaluation of evidence.

Reporting
The final stage in the auditing process is preparing the Audit Report, which is the communication of the auditors findings to users.
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Audit of a Tax Return Example

Information Competent, independent person Federal tax returns filed by taxpayer Report on results

Internal revenue agent

Accumulates and evaluates evidence Examines cancelled checks and other supporting records

Determines correspondence
Established criteria Internal Revenue Code and all interpretations

Report on tax deficiencies

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Attestation Services

1. Audit of historical financial statements 2. Effectiveness of internal control over financial reporting

3. Review of historical financial statements

4. Other attestation services
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Assurance, Attestation, and Nonassurance Services

ASSURANCE SERVICES

ATTESTATION SERVICES Audits Reviews Certain Management Consulting

Internal Control over Financial Reporting Other Attestation Services (e.g., WebTrust, SysTrust)

Other Assurance Services

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Learning Objective 2

Differentiate the three main types of audits.

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Types of Audits

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Operational Audit
Example Evaluate computerized payroll system for efficiency and effectiveness Number of records processed, costs of the department, and number of errors Company standards for efficiency and effectiveness, or best practice Error reports, payroll records, and payroll processing costs
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Information
Established Criteria Available Evidence

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

Compliance Audit
Example Determine whether bank requirements for loan continuation have been met

Information
Established Criteria Available Evidence

Company records
Loan agreement provisions, or law/regulation Financial statements and calculations by the auditor
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2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

Financial Statement Audit

Example Annual audit of Boeings financial statements

Information
Established Criteria Available Evidence

Boeing's financial statements

Generally accepted accounting principles Documents, records, and outside sources of evidence
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2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

Learning Objective 3

Explain: - Objective of conducting an audit of FS - Management assertion and its correlation to FS Audit.

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Steps to Develop Audit Objectives

1 Understand objectives and responsibilities for the audit. Divide financial statements into cycles. Know management assertions about accounts. Know general audit objectives for classes of transactions and accounts.

2 3 4
5

Know specific audit objectives for classes of transactions and accounts.

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2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

Objective of Conducting an Audit of FS

Provide an opinion of the fairness with which they present fairly, in all respects, financial position, result of operations, and its cash flows in conformity with GAAP.

Auditors Responsibilities
Material versus immaterial misstatements Reasonable assurance Errors versus fraud Professional skepticism Fraud resulting from fraudulent financial reporting versus misappropriation of assets
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2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

Sub Learning Objective 3

Understand the 5 categories of management assertions

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Management Assertions
1. Existence or occurrence 2. Completeness 3. Valuation or allocation 4. Rights and obligations 5. Presentation and disclosure
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Transaction-Related Audit Objectives and Management Assertions

Management Assertions Existence or occurrence Completeness
General TransactionRelated Audit Objectives Existence Completeness

Valuation or allocation

Accuracy Classification Timing Posting and summarization

Rights and obligations N/A Presentation and disclosure N/A

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Transaction-Related Audit Obj. and Mgt Assertions

Existence Completeness Accuracy Classification Timing Posting and summarization Recorded transactions exist. Existing transactions are recorded. Recorded transactions are stated at the correct amounts. Transactions are properly classified. Transactions are recorded on the correct dates. Trans. are included in the master files and are correctly summarized.
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2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

Assertions and Balance-Related Audit Obj.

Management Assertions Existence or occurrence Completeness General Balance Related Audit Objectives Existence Completeness Accuracy Classification Cut-off, Detail tie-in Realizable value Rights and obligations

Valuation or allocation

Rights and obligations

Presentation and disclosure Presentation and disclosure

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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General Balance-Related Audit Objectives

Existence Completeness Accuracy Classification Amounts included exist. Existing amounts are included. Amounts included are stated at the correct amounts. Amounts are properly classified.

Cutoff

Trans. recorded in the proper period.

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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General Balance-Related Audit Objectives

Detail tie-in Account balances agree with master file amounts, and with the GL Assets are included at estimated realizable value. Assets must be owned. Account balances and disclosures are presented in FS.
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Realizable value Rights and obligations Presentation and disclosure

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

Explain the relationship between audit objectives and the accumulation of audit evidence.

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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How Audit Objectives Are Met

The auditor must obtain sufficient competent audit evidence to support all management assertions in the financial statements. An audit process is a methodology for organizing an audit.

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Four Phases of a Financial Statement Audit

Phase I Plan and design an audit approach.

Perform analytical procedures and Phase III tests of details of balances.

Phase II

Perform tests of controls and substantive tests of transactions.

Complete the Phase IV audit and issue an audit report.

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2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

Learning Objective 4

Financial Audit Reporting

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Parts of the Standard Unqualified Audit Report

1. Report title 2. Audit report address 3. Introductory paragraph 4. Scope paragraph 5. Opinion paragraph 6. Name of CPA firm 7. Audit report date

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Conditions for Standard Unqualified Audit Report

1. All financial statements are included. 2. The three general standards have been followed in all respects on the engagement.

3. Sufficient evidence has been accumulated to conclude that the three standards of field work have been met. 4. The FS are presented in accordance w/ GAAP.
5. No circumstances requiring the addition of an explanatory paragraph or modification of the wording of the report.
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Four Categories of Audit Reports

Unqualified with explanatory paragraph or modified wording

Standard unqualified

Qualified

Adverse or disclaimer

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Sub Learning Objective 4

Describe the 5 circumstances, when an unqualified report with: - An explanatory paragraph, or - Modified wording is appropriate.

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Unqualified Report with Explanatory Paragraph

1. Lack of consistent application of GAAP 2. Substantial doubt about going concern 3. Auditor agrees with a departure from promulgated accounting principles 4. Emphasis of a matter 5. Reports involving other auditors

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Consistency Versus Comparability

Changes that affect consistency and require an explanatory paragraph if they are material: 1. Changes in accounting principles 2. Changes in reporting entities 3. Corrections of errors involving principles Changes that affect comparability but not consistency:

1. Changes in an estimate 2. Error corrections not involving principles 3. Variations in format and presentation of financial inf. 4. Changes because of substantially diff. trans. or events
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Substantial Doubt About Going Concern

1. Sig. recurring operating losses or working cap. deficiencies 2. Inability of the comp. to pay its obligations as come due 3. Loss of major customers, the occurrence of uninsured catastrophes 4. Legal proceedings, legislation that might jeopardize the entitys ability to operate

Auditor Agrees with a Departure from a Promulgated Principle

The auditor must be satisfied and must state and explain, in a separate paragraph(s) in the audit report, that adhering to the principle wouldve produced a misleading result in that situation
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Emphasis of a Matter
Under certain circumstances, the CPA may want to emphasize specific matters regarding the FS, even though the CPA intends to express an unqualified opinion.

Reports Involving Other Auditors

1. Make no reference in the audit report. 2. Make reference in the report (modified wording report). 3. Qualify the opinion.
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Sub Learning Objective 4

Identify the types of audit reports that can be issued when an unqualified opinion is not justified.

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Departures from an Unqualified Opinion

1. Scope limitation

2. GAAP departure

3. Auditor not independent

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Qualified Opinion
A qualified opinion report can result from a limitation on the scope of the audit or failure to follow GAAP.

Adverse Opinion
It is used only when the auditor believes that the overall FS are so materially misstated or misleading that they do not present fairly the financial position or results of operations and cash flows in conformity with GAAP.

Disclaimer of Opinion
It is issued when the auditor is unable to be satisfied that the overall FS are fairly presented.
2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Sub Learning Objective

Explain how materiality affects audit reporting decisions.

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Scope Restricted by Client or Other Conditions

Level of Materiality Immaterial Unqualified report Material Qualified scope, additional paragraph, and qualified opinion (except for)

Extremely Material Disclaimer of opinion

Statements Not Prepared in Accordance With GAAP

Level of Materiality Immaterial Unqualified report Material Additional paragraph and qualified opinion (except for) Extremely Material Adverse opinion
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2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

The Auditor Is Not Independent

Level of Materiality Extremely Material

Immaterial

Material
Disclaimer of opinion (regardless of materiality)

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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End of Session 1

2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder

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Tugas: (tulis tangan)

1.
2.

Jelaskan definisi audit? Berikan penjelasan elemen-elemen dari definisi tersebut.

Sebutkan dan jelaskan 3 tipe audit? Uraikan persamaan dan perbedaannya?

3.
4. 5. 6.

Jelaskan tujuan audit keuangan?

Jelaskan definisi asersi manajemen? Jelaskan 5 asersi manajemen? Sebutkan dan jelaskan 3 jenis utama opini dalam laporan audit keuangan? Dapatkan dari internet 1 contoh unqulified opinion laporan audit keuangan (tidak termasuk LK Perusahaannya). Lalu, print, dan kemudian identifikasi 7 parts Laporan Audit dengan Unqualified Opinion dalam laporan tersebut.
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2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder