AUD Study Group April/May 2013 - Page 13

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  • March 29, 2013 at 4:06 pm #414571
    Anonymous
    Inactive

    Test Data: Auditor tests FAKE/DUMMY transactions on the CLIENTS computer system and compares results. Each control needs to only be tested ONCE.

    Parallel: Actual client data is tested on the AUDITORS computer system using GENERALIZED AUDIT SOFTWARE(I think).

    Embedded Audit Module: CONTINUOUS monitoring. An example is SCARF.

    March 29, 2013 at 4:51 pm #414572
    Shanta_J
    Member

    @Journey… I've been focusing on the multiple choice to help “train” me to read the questions and be able to point out keywords…. my problem is I don't like to read the full questions and kind of fly through the answer choices.. and I know for audit that will kill my score…….. i didn't really take notes through the chapter, I just wrote out the mnemonics so that i can remember them.

    And working on studying the ratios in Chapter 4 (I use becker). My test is on the 15th …so I will be doing multiple choice OVER AND OVER AND OVER until I get sick 🙂

    REG*75* 02.27.13(1)
    AUD*82* 04.15.13(1)
    BEC 05.29.13
    FAR 08.12.13

    -Becker Self-Study-
    *Through God all things are Possible*

    March 29, 2013 at 4:52 pm #414573
    Shanta_J
    Member

    Thanks Casey! I think I get it… I just need to go through the chapter again!

    REG*75* 02.27.13(1)
    AUD*82* 04.15.13(1)
    BEC 05.29.13
    FAR 08.12.13

    -Becker Self-Study-
    *Through God all things are Possible*

    March 29, 2013 at 5:37 pm #414574
    Topsya
    Member

    Tracing a sample of entries in the cash receipts journal to daily deposit slips tests which of the following audit objectives for cash?

    A) Validity.

    B) Completeness.

    C) Valuation.

    D) Cutoff.

    The correct answer is “A” WHY NOT “B”??????

    AUD - 90
    FAR - 83
    BEC - 81
    REG - 80
    ETHICS - 100

    March 29, 2013 at 5:47 pm #414575
    Shanta_J
    Member

    @Topsya….

    The fact that the sentence says “Tracing” doesn’t necessary mean that the question relates to “tracing”

    It says from the cash receipts journal TO daily deposit slips.

    So you are going from the Journal DOWN to the daily deposit slips (which is your source documents). And by doing this you are looking at EXISTENCE which is VALIDITY.

    So basically… you want to make sure what you have in the cash receipts journal is VALID so you check the deposit slips. Think about your bank account…. If you saw money being put into your account that you didn’t do…… you would want to check if it was valid, so the bank would check the deposit slip..

    Does that help?

    Completeness means you want to be sure it was actually done… so completeness would be going from the deposit slip TO the cash receipt journal. (the opposite of what I stated above)… meaning you would look at your deposit slip and make sure it was actually place into your bank (which means completeness)…. “the transaction has been completed”

    hope that makes sense.. if not, let me know 🙂 and I can try to reword it

    REG*75* 02.27.13(1)
    AUD*82* 04.15.13(1)
    BEC 05.29.13
    FAR 08.12.13

    -Becker Self-Study-
    *Through God all things are Possible*

    March 29, 2013 at 6:10 pm #414576
    Topsya
    Member

    oh

    hold on

    what happens first? Cash Receipt Journal or Daily Deposit slips?

    I though that when money received from the customer, they are first going into Cash Receipt Journal, and then money are getting deposited into the bank (Daily deposit slips). So Cash Receipt Journal would be the initial register, and Daily Deposit slips secondary

    Am I correct or not? Im lost…..

    AUD - 90
    FAR - 83
    BEC - 81
    REG - 80
    ETHICS - 100

    March 29, 2013 at 7:06 pm #414577
    Shanta_J
    Member

    The deposit slip comes FIRST because what's in your cash receipt journal is determined by what you deposit.

    Think of the cash receipt journal as your check registrar

    The checks you write determines what's in your check registrar

    So back to the original question….. the deposit slips you create determines what's in your cash receipt journal … thus, when you go from the Cash receipt journal to the deposit slips, you are making sure what's in the journal is valid.

    Does that help?

    REG*75* 02.27.13(1)
    AUD*82* 04.15.13(1)
    BEC 05.29.13
    FAR 08.12.13

    -Becker Self-Study-
    *Through God all things are Possible*

    March 29, 2013 at 7:39 pm #414578
    Topsya
    Member

    It really does help, thanks

    I though that the Deposit Slips used ONLY in case of a bank deposit….. oh well… i learn every day! 🙂

    AUD - 90
    FAR - 83
    BEC - 81
    REG - 80
    ETHICS - 100

    March 30, 2013 at 2:09 am #414579
    Jimmy520
    Member

    Got a question, Under what circumstances do the explanatory paragraph precedes or follows opinion paragraph?

    Unqualified– After

    Qualified or adverse– Before

    I think there are some exceptions to these? Can anyone help out? Thx

    FAR-2/1/2013 Passed!!
    AUD-4/5/2013
    REG-5/31/2013
    BEC-7/15/2013

    March 30, 2013 at 10:14 am #414580
    Anonymous
    Inactive

    Jimmy520,

    The only exception I have listed involves comparative financial statements:

    If a prior period financial statement is updated/restated (ex. Qualified —-> Unqualified), then we add an explanatory paragraph that precedes the opinion. The paragraph must contain the following:

    i) All substantive reasons for the different opinion

    ii) Date of previous report

    iii) Type of opinion previously stated

    iv) Circumstances causing auditor to change opinion

    March 30, 2013 at 11:09 am #414581
    Anonymous
    Inactive

    Please help:

    Which of the following would be a consideration in planning a sample for a test of subsequent cash receipts?

    a) Preliminary judgements about materiality levels.

    b) The auditor's allowable risk of assessing control risk is too low.

    c) The size of the intercompany receivable balance.

    d) The amount of bad debt write-offs in the prior year.

    March 30, 2013 at 11:13 am #414582
    Anonymous
    Inactive

    Another good one:

    In estimation sampling for attributes, which of the following must be known in order to appraise the results of the auditor's sample?

    a) Standard deviation of the values in the population.

    b) Sample size.

    c) Estimated dollar value of the population.

    d) Actual occurrence rate of the attribute in the population.

    March 30, 2013 at 5:24 pm #414583
    Anonymous
    Inactive

    3 weeks and I finally just finished A1 – I've got some serious catching up to do. It took me a bit to get my mind switched over to Audit material for some reason. I think I'm gonna go and schedule my exam now for the beginning of May so I will start the clock ticking. Someone tell me I suck so I can get motivated! =)

    March 30, 2013 at 6:52 pm #414584
    Journey to Fate
    Participant

    @ casey – Sample Size!

    BEC- 67, 69

    March 30, 2013 at 9:50 pm #414585
    Topsya
    Member

    @ casey

    answer to your fist question:

    a) Preliminary judgements about materiality levels

    second:

    b) Sample size.

    AUD - 90
    FAR - 83
    BEC - 81
    REG - 80
    ETHICS - 100

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