X UNIVERSITY

College of Accountancy

Bachelor of Science in Accountancy

Course Syllabus in Auditing Theory Review

2nd Trimester, S.Y. 2011-2012

I. Course Code: Acctg30

II. Course Description:

The course is a three-unit subject intended to provide the students with concepts underlying the public accounting practice and the auditor as a professional.

This subject tests the candidates’ conceptual knowledge and understanding of assurance and related services performed by professional accountants.
Candidates should know and understand the nature of assurance and related services particularly independent audits of financial statements, the responsibilities of
professional accountants; the audit process; audit objectives, evidence, procedures, auditing standards, and the elements of the independent auditors’ report. In all
the areas included, the candidate shall apply the Philippine Standards on Auditing (PSA) and other regulatory laws and regulations in effect at the time of
examination.

Credit Units : 3 units

Contact Hours : 50 hours, 1 meeting per week, 4 hours per meeting
Prerequisites : Accounting 20/21

III. Course Outcomes:

CO # Description PO1 PO2 PO3 PO4 PO5 PO6 PO7

1 State, explain and discuss the nature of auditing, the type of audit, the characteristics if 3 1 2 1 1 1 3
accounting, as a profession, the significant provisions of the Revised Accountancy Law, and
the operations of public accounting firms.

2 Explain and discuss the nature of audit objectives, evidences, procedures and techniques and 3 1 3 2 2 2 3
apply the concepts and principles of internal control and techniques used to review and
evaluate internal controls.
 3 Demonstrate the concepts and methodology of statistic audit sampling and prepare audit 2 1 2 2 3 1 3
reports under varying circumstances.

IV. Course Contents:

Objectives Topics # of meetings Grading Teaching Assessment

Period Learning Tools
Activities
1. Discuss the essence of auditing and Fundamentals of Auditing and Prelims Lecture/ Assignments
assurance services in business. Assurance Services PPT Presentation Seatwork
2. Identify the elements of assurance A. Introduction to assurance Problem-solving Quizzes
engagements and cites actual examples of engagements Board Exercises Recitations
assurance engagements 1. Nature, objective and elements
3. Discuss the basic principles of auditing 2. Types of assurance
4. Discuss the classification of audit and auditors engagements
3. Assurance service vis-à-vis
attestation services
B. Introduction to auditing
1. Nature, philosophy, and
objectives
2. Types of audits 3 meetings
1. Discuss the attributes of a profession The Professional Practice of Accounting Prelims Lecture/ Assignments
2. Discuss the environment of the accounting A. Practice of accounting profession PPT Presentation Seatwork
professions 1. Accounting as a profession Problem-solving Quizzes
3. Identify and discuss the impact of regulatory 2. Organizations that affect public Board Exercises Recitations
agencies to the exercise of accountancy accounting
4. Discuss the different standard setting bodies a. Regulatory government
that affects the practice of accountancy agencies
5. Discuss the regulations set forth under the b. Standard-setting bodies
Code of Professional Ethics 3. Regulation of the public
6. Discuss requirement of the Philippine accounting practice
Accountancy Act of 2004 a. RA 9298
b. SRC Rule 68

B. The CPA’s professional

responsibilities
1. Philippine Standards on Auditing
2. Code of Ethics
3. Quality control
4. PSA 240 – Fraud, Error, and
Noncompliance

PRELIM EXAMINATION OCTOBER 21-22, 2011

1. Discuss the overview of the audit process. The Financial Statements Audit –Client 1 meeting Midterms Lecture/ Assignments
2. Rationalize and discuss the importance of risks Acceptance, Audit Planning, PPT Presentation Seatwork
assessment procedures in the pre- Supervision and Monitoring Problem-solving Quizzes
engagement stage of the audit. A. The Generally Accepted Auditing Board Exercises Recitations
3. Discuss the elements of audit planning and its Standards (GAAS)
scope. B. Overview of the audit process
4. Discuss the importance of supervision C. Pre-engagement procedures
D. Audit Planning Requirements
1. Planning requirements
a. Knowledge of the business
b. Preliminary analytical
procedures
c. Materiality
d. Assessing and managing audit
risks
e. Overall audit plan and audit
program
f. Considerations of the work of
others (experts, internal auditor,
other independent auditors)
2. Direction, supervision and review
1. Discuss the procedures used to obtain PSA 315 and PSA 330 – Understanding 1 meeting Midterms Lecture/ Assignments
understanding of an entity and its environment. the Entity and its Environment Including PPT Presentation Seatwork
2. Discuss the required understanding of the its Internal Control and Assessing the Problem-solving Quizzes
entity’s internal control. Risks of Material Misstatement Board Exercises Recitations
3. Discuss assessing the risks of material A. Industry, regulatory and other
misstatement at the financial statement level external factors, including the
and at the assertion level. applicable financial reporting
4. Discuss development of responses to framework
assessed level of risks at the financial B. Internal control
statement level and assertion level. a. Understanding and
documentation
b. Assessment of control risks
a) Test of controls
b) Documentation
C. Assessing the risks of material
misstatement
1.
D. Communicating with those
charged with governance and
management

1. Define and contrast audit objectives, Audit Objectives, Procedures, 1.5 meeting Midterms Lecture/ Assignments
procedures, evidence and documentations Evidences and Documentation PPT Presentation Seatwork
2. Discuss reliability of audit evidence A. Nature and significance Problem-solving Quizzes
B. Evidential matters Board Exercises Recitations
3. Discuss audit procedures and working paper C. Audit procedures / techniques
documentations D. Audit working papers

1. Discuss the nature and type of sampling Audit Sampling 1.5 meeting Midterms Lecture/ Assignments
approaches A. Basic audit sampling concepts PPT Presentation Seatwork
2. Distinguish statistical and non-statistical 1. Nature and purpose Problem-solving Quizzes
sampling 2. Non-statistical and statistical Board Exercises Recitations
3. Discuss the application of audit sampling for sampling
test of controls 3. Attribute and variables sampling
4. Discuss the application of audit sampling for technique
substantive tests 4. Sampling and non-sampling risk
5. Discuss projection and estimation of errors in a 5. Testing procedures which do not
given population involve sampling
6. Discuss evaluation of sampling results B. Factors affecting sample design
C. Factors affecting sample size
D. Sample selection methods
 E. Evaluation of sample results

MIDTERM EXAMINATION NOVEMBER 23 – 24, 2011

1. Discuss and identify engagement wrap-up Completing the Audit / Post-Audit 1 meeting Finals Lecture/ Assignments
procedures Responsibilities PPT Presentation Seatwork
2. Discuss the auditor’s post audit responsibilities A. Completing the audit and audit Problem-solving Quizzes
report preparation Board Exercises Recitations
B. Post-audit responsibilities
1. Subsequent discovery of facts
2. Subsequent discovery of omitted
procedures

1. Discuss the preparation of audit reports Reports on Audited Financial 1 meeting Finals Lecture/ Assignments
2. Discuss the rules of modification of the audit Statements PPT Presentation Seatwork
reports A. The unqualified auditor’s report Problem-solving Quizzes
3. Distinguish issues that do not lead to B. Basic elements of the unqualified Board Exercises Recitations
modification of the opinion and those that do auditor’s report
not C. Modified auditor’s report
4. Discuss reporting on comparatives 1. Matters that do not affect the
auditor’s opinion
2. Matters that do affect the auditor’s
opinion
D. Report on comparatives

1. Identify and discuss other assurance and non- Other Assurance and Non-assurance 1 meeting Finals Lecture/ Assignments
assurance engagements that are provided by Services PPT Presentation Seatwork
professional accountants in practice A. Procedures and reports on special Problem-solving Quizzes
2. Discuss professional requirements imposed by purpose audit engagements Board Exercises Recitations
applicable standards for each line of service 1. Audit of financial statements
prepared in accordance with a
comprehensive basis of
accounting other than GAAP in
the Philippines
2. Audit of a component of financial
statements
3. Reports on compliance with
contractual agreements
4. Reports on summarized financial
statements
B. Other assurance engagements:
procedures and reports
1. Examination of prospective
 financial information
2. Engagements to review financial
statements
C. Non-assurance engagements
1. Agreed-upon procedures
regarding financial information
2. Compilation of financial
information

FINAL EXAMINATION DECEMBER 14 -17, 2011

V. Teaching-Learning Activities (TLA)

TLA Description CO1 CO2 CO3
1 Lecture presentation 60% 60% 70%
2 Problem-solving 30% 30% 20%
3 Board exercises 10% 10% 10%

VI. Assessment Tools (AT)

AT Description CO1 CO2 CO3

1 Assignments and seatwork 10% 10% 10%
2 Examinations 50% 50% 50%
3 Recitations and quizzes 40% 40% 40%

VII. Computation of Scores:

Prelims:
Prelim Grade = 10%SW/A + 40% QUIZ + 50% EXAM

Midterms:
Raw Midterm Grade = 10% SW/A + 40% QUIZ + 50% EXAM
Midterm Grade = 50% Prelim Grade + 50% Midterm Raw Score
Finals:
Raw Final Grade = 10% SW/A + 40% QUIZ + 50% EXAM
Final Grade = 50% Midterm grade + 50% Raw Final Grade
VIII. References:

A. Textbook:

Acl 657.450218599 P538 2008 PICPA-MMR Committee on CPE (2008), Philippine Standards on Auditing,

Acl 657.45 R358 2010 Ricchiute, David N. Auditing and Assurance Services 7th Edition, South Western College Publishing, Cincinnati, Ohio 2010

Ireneo, Jose M., Ireneo, Shirley C., and James, George R. (2011), Auditing and Assurance Principles

Salosagcol, Jekell, Tiu, Micheal and Hermosilla, Roel, Auditing Theory and Concepts, GIC Enterprises & Co., Inc. 2008

B. Books:

Acl 657.45076 B63 2008 Bobadilla, Apolinario D. and Ocampo, Reynaldo R. (2008 Edition), Reviewer in Auditing Theory, Lares Bookstore, Manila

Acl 657.45076 C112 2008 Cabrera, Ma. Elenita Balatbat, Comprehensive CPA Reviewer in Auditing Theory, GIC Enterprises & Co. Inc, Manila 2008

Acl 657.45076 W618 2008 Whittington, O. Ray and Delaney, Patrick R. (2008 Edition), Wiley CPA Exam Reviewer – Auditing and Attestation, John Wiley &
Sons, Inc., Hoboken, New Jersey

Code of Ethics for Professional Accountants in the Philippines (Effective June 30, 2008)

Philippine Standards on Auditing (PSAs), Auditing and Assurance Standards Council

Philippine Standards on Assurance Engagements (PSAEs), Auditing and Assurance Standards Council

Philippine Standards on Related Services (PSRSs), Auditing and Assurance Standards Council

Philippine Standards on Review Engagements (PSREs), Auditing and Assurance Standards Council

Philippine Standards on Quality Control (PSQCs), Auditing and Assurance Standards Council

Practice Statements, Auditing and Assurance Standards Council

R.A. 9298 – Philippine Accountancy Act of 2004 (Effective May 13, 2004)

Rules and Regulations for the Accreditation of Accounting Teachers (Effective June 20, 2008)
 C. Online References:

www.prboa.com
www.aasc.org.ph
www.picpa.com.ph

Prepared by: Evaluated by: Approved by: Noted by: