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Chapter 1

INTRODUCTION TO
ASSURANCE &
AUDITING SERVICES

Prescribed textbook

AUDITING & ASSURANCE SERVICES IN AUSTRALIA 7TH

(2018)- Grant Gay& Roger Simnett
Chapter 1, 2

KIỂM TOÁN (2017), 7th - Bộ môn Kiểm toán

Chương 1

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• Relevant guidance
ISA/VSA 200 Overall objectives of the independent auditor and the
conduct of an audit in accordance with ISAs
Law on Independent Audit No 67/2011/QH12

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LEARNING OBJECTIVES
Upon completion of this chapter you will
• Understand the nature of assuarance & auditing
services
• Be able to distinguish different types of audits and
auditors.
• Know the development of audit profession.
• Understanding the reasons giving rise to demand for
financial statement audit.
• Understand the professional requirements of auditors
and audit firms and be able to describe internal
structure of an audit firm.
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CONTENT

Definition of Assurance and Auditing

Classification of audit

The develoment of audit profession

The roles of independent audit in the economy

Auditor, Audit firms and Professional bodies

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WHAT ARE ASSURANCE SERVICES?

• Assurance services: a broad range of independent

professional services that improve the quality of information,
or its context, for decision makers.
 enhance the degree of confidence in the information
• 2 types:
– Attestation services  increase the reliability of info
– Other assurance services  put info in a form or context that facilitates
decision making.
• Attestation services including
– Audit/examination
– Review
– Agreed-upon procedures
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1. WHAT IS AUDIT?

Entrust resources

Investors Managers

Required periodic reporting

on use of resources

Verification by independent expert

 a demand for auditing

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1. What is Auditing?

Auditing has been defined as:

“A systematic process of objectively obtaining and evaluating
evidence regarding assertions about economic actions and
events to ascertain the degree of correspondence between
those assertions and established criteria and communicating
the results to interested users.”
A statement of Basis Auditing Concepts (ASOBAC)

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1. What is Auditing?

Assertions about
economic actions and
events

Independen obtaining and Degree of Issuance of

t and evaluating correspondence audit report
competent evidence
auditor

Established criteria

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2. Audit classification
Operational audit

AUDITS Compliance audit

Financial statement audit

AUDIT
CLASSIFICATION
Internal auditors

AUDITORS Government auditors

Independent/External
auditors

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2.1. Types of audits

Operational audit

AUDITS

AUDIT
CLASSIFICATION

Operational audit: value for money audit, performance audit or

efficiency audit. Chủ thể
Operational audit is a more comprehensive activity designed to
analyze organization structure, internal systems, work flow and
managerial performance.
It is usually associated with issues of efficiency, effectiveness and
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2.1. Types of audits

Operational audit

AUDITS

AUDIT
CLASSIFICATION

•A systematic review of part or all of an organization’s activities to

evaluate whether resources are being used effectively and
Chủ thể
efficiently
•Assess performance, identify area for improvement, and develop
recommendations

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2.1.Types of audits
Operational audit

AUDITS Compliance audit

AUDIT
CLASSIFICATION

Determine the extent to which rules, policies, laws, covenants, or

government regulations are followed by the entities being audited
Chủ thể
e.g., examination of tax returns of individuals or companies by the
tax authorities

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2.1.Types of audits
Operational audit

AUDITS Compliance audit

Financial statement
audit
AUDIT
CLASSIFICATION

• To obtain reasonable assurance about whether the financial

Chủ
report as a whole is free thể material misstatement,
from
whether due to fraud or error, thereby enabling the auditor to
express an opinion on whether the financial report is prepared,
in all material respects, in accordance with an applicable
financial reporting framework.
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2.2. Types of auditors

•Are the employees of the entities being audited

•Conduct financial, internal control, compliance, operational and
forensic audits within their organization Operational audit
•Provide assurance and consulting services to their entities
AUDITS Compliance audit

Financial statement
audit
AUDIT
CLASSIFICATION

Internal auditor

AUDITORS
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2.2. Types of auditors

•Are employed by government agencies
•Tax officers, State Auditors, Government Inspectors, …
Operational audit

AUDITS Compliance audit

Financial statement
audit
AUDIT
CLASSIFICATION
Internal auditor

AUDITORS Government auditor

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2.2. Types of auditors

• May practice as sole proprietor or as a member of a CPA/audit
firm
Operational audit
• Are not the employees of the entities being audited
• Provide a range of both assurance and non-assurance
AUDITS Compliance services
audit
to their clients

Financial statement audit

AUDIT
CLASSIFICATION
Internal auditor

AUDITORS Government auditor

Independent/External
auditor

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3. History and development of audit

profession in the world

Before 1900 From 1900 until now

Objective Detect error and Give an opinion about the
fraud of staff true and fair of accounting
figure
Method The detailed Auditing approach where not
verification of all transactions had to be
every tested- Audit sampling
transaction Accessing the internal
control system
Audited in Informatic
environment
Extent audit approach to risk
based approach
User Owner Stakeholder, Investor, Debtor,
2018
Bank…
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3. The development of audit

profession in Vietnam
• 1991: the first two local audit firms, namely VACO and
AASC were established
• 1999: the first series of 6 VSAs were issued.
• Till 30 May 2005, there are 33 VSAs issued, most of which
were closely adapted from ISAs.
• 2012: Law on Independent Audit No 67/2011/QH12 took
effect.
• 2012: 2005’s VSAs were replaced by a new set of VSAs.
• Until now, MOF has issued a total of 47 new standards on
2018
Auditing and Assurance services.
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International Audit firms - BIG4

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4. The roles of external audit in the economy

Entrust resources

Investors Managers

Required periodic reporting

on use of resources

Verification by independent expert

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4. The roles of external audit in the economy

Information is
likely to be
distorted.
What measures
should be
taken?

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4. The roles of external audit in the economy

• The difficulty in accessing information

resources
• The motivation of informant
RISK • The large volume and complexity of
information

The users directly check the information

MEASURES Strengthen the legal responsibility of the
Board of Directors
Compulsory audited financial statements

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5. Auditors, Audit firms and Professional bodies

a. External auditors

Qualification
Experience

CPA

EXTERNAL AUDITORS
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5. Auditor, Audit firms and Professional bodies

Certified Public Accountant (CPA)
An auditor must meet the following standards (Article 14 - Law on
Independent Audit):
a) Having full capacity for civil acts;
b) Having good professional ethics, sense of responsibility,
integrity, honesty, and objectivity;
c) Having degree of university or higher in finance, banking,
accounting, auditing disciplines or other disciplines as
prescribled by the Ministry of Finance;
d) Having an auditor’s certificate in accordance with
regulations the Ministry of Finance.

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5. Auditor, Audit firms and Professional bodies

Certified Public Accountant
Conditions for the candidates: (Circular No 129/2012/TT-BTC )
- Professionally ethical, honest, upright, and law-abiding;
- Having the Bachelor’s degree or higher in finance, banking, accounting,
audit;
- Having worked in finance or accounting for at least 60 months from the
month of graduation written on the higher education graduation
decision at the time of exam registration; or having worked as an audit
assistant in an audit enterprise for at least 48 months from the month of
graduation written on the higher education graduation decision at the
time of exam registration;
- Completely and correctly submit the exam application and fee as
prescribed.
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5. Auditor, Audit firms and Professional bodies

Certified Public Accountant
Candidates for Audit practitioner certificates must take the tests on 7 subjects:

1. Economic law and the Law on Enterprise;

2. Advanced finance and financial management;
3. Advanced tax and tax administration;
4. Advanced public sector accounting, financial accounting;
5. Advanced audit and assurance services;
6. Advanced financial analysis;
7. C-level qualification in one of the following foreign
languages: English, Russian, French, Chinese, German.
The candidates that pass all 7 subjects, and the total mark
(except of foreign language subjects) is 38 or more, are
considered passed.
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5. Auditor, Audit firms and Professional bodies

b. Audit firms

Partner

Manager

Senior

Staff Assistant

Career Path
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SERVICES PROVIDED BY AUDIT FIRMS

 Audit
• Assurrance service
 Review
 Other assurance services

• Related services  Agreed-upon procedures regarding

financial information
 Compilation of financial information
• Tax consultance
 Tax consultancy/ Tax planning
• Management
consultance  Financial consultancy/ Strategy
development
• Others
 Education/ Training
2018  Head
Auditing hunter
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5. Auditor, Audit firm and Professional bodies

Professional Organizations in Vietnam
The Vietnam Association of Certified Public Accountants (VACPA)
 established on 15/04/2005 and started to operate from
01/01/2006.
 68th member of the Vietnam Union of Science and
Technology Associations (VUSTA)
 Member of the Confederation of Asian and Pacific
Accountants (CAPA) since 2010
 Member of the International Federation of Accountants
(IFAC) on 11 November 2015.

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5. Auditor, Audit firm and Professional bodies

Professional Organizations in the world

International Federation of Accountants (IFAC) is

the global organization for the accountancy profession
dedicated to serving the public interest by
strengthening the profession and contributing to the
development of strong international economies.

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THANKS FOR

YOUR LISTENING

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