[jeff]

Welcome to the Q1 2016 CPA Exam Study Group for AUD.

Some BLITZ videos to help your exams: https://www.another71.com/ninja-blitz

[payaza2000]

Just so I got this right,

A Audit is an Attestation Engagement which is governed by the rules of SAS for non issuers, and PCAOB for Issuers.

Compilation & Review Engagements are Non-Attest Services governed by SSARS

Other Attest Functions ( Agreed-upon procedures, Financial Forecast/Projections, Pro-Forma F/S) are governed by
SSAE Statements on Standards for Attestation Engagements?

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[payaza2000]

Just so I got this right,

A Audit is an Attestation Engagement which is governed by the rules of SAS for non issuers, and PCAOB for Issuers.

Compilation & Review Engagements are Non-Attest Services governed by SSARS

Other Attest Functions ( Agreed-upon procedures, Financial Forecast/Projections, Pro-Forma F/S) are governed by
SSAE Statements on Standards for Attestation Engagements?

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[csvirk]

The element of the audit planning process most likely to be agreed upon with the client before implementation of the audit strategy is the determination of the:

A.
evidence to be gathered to provide a sufficient basis for the auditor's opinion.

B.
procedures to be undertaken to discover litigation, claims, and assessments.

Incorrect C.
pending legal matters to be included in the inquiry of the client's attorney.

D.
timing of inventory observation procedures to be performed.

Correct Answer is D. But isn't timing is based on Auditor's desecration? My answer was C.

FAR: 71, 77!
AUD: 69, 80
BEC: 72
REG: 84

[SaveBandit]

@csvirk

Inventory counts are usually set in stone. So if the company is taking inventory on 12/31 the auditor needs to know that in advance so they can send someone to observe. The auditor can't be like “oh just do inventory on January 5” because then inventory wouldn't be correct on the balance sheet for year end.

4 for 4

FAR 85
AUD 94
BEC 86
REG 90

[csvirk]

@Bandit.

Thank you, make sense. But when does auditor suppose to do surprise inventory check?

FAR: 71, 77!
AUD: 69, 80
BEC: 72
REG: 84

[SaveBandit]

Which of the following procedures generally would not be performed in a review of a public entity's interim financial statements?

A. Inquire regarding significant deficiencies in internal control.
B. Inquire of the client's attorney
C. Read the minutes of stockholder meetings, directors' meetings, etc.
D. Compare the current quarter to comparable quarter from previous yr.

B is correct.

I thought we didn't care about internal control in a review? Or am I thinking of just a regular review of an entity's financials? If so, what's the difference between a review of interim financials and a review of an entity's year end financials? Outside of the standard audit reports, I get pretty lost.

4 for 4

FAR 85
AUD 94
BEC 86
REG 90

[csvirk]

@Bandit

This question is confused. I am reading as when auditor review interim financials statements to understand and assess risk of an entity and then plan the audit accordingly.

FAR: 71, 77!
AUD: 69, 80
BEC: 72
REG: 84

[payaza2000]

Going through Becker 2 for Audit, and I found that I really struggled with the Chapter on Financial Projections/ Financial Forecast. Can Someone either point to the part in the NINJA book where this is more clearly explained, the authoritative literature (I have the SAS, and SSARS), or be kind enough to summarize it themselves.

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[FAR_WARS]

North Co., a privately held entity, asked its tax accountant, King, a CPA in public practice, to review and generate North's interim financial statements on King's microcomputer when King prepared North's quarterly tax return. King should not submit these financial statements to North unless, as a minimum, King complies with the provisions of:

A. Statements on Standards for Accounting and Review Services. (correct)
B. Statements on Standards for Unaudited Financial Services.
C. Statements on Standards for Consulting Services.
D. Statements on Standards for Attestation Engagements.

Why is the answer to this question not SASs? I thought reviews for INTERIM statements followed SASs? What are the exceptions?

FAR- 80
BEC- 75
AUD- 78
REG- ?

[payaza2000]

@FAR_WARS

Reviews/Compilations follow SSARS (Statement on Accounting & Review Services).

“King, a CPA in public practice, to review and generate North's interim financial statements”- I believe this would be the clue to what standards you have to follow, If you are asked to generate the F/S it would fall under SSARS, because you are preparing the F/S. I think? Again I could be wrong I failed Audit once before.

AR-C 70
.”01 This section applies when an accountant in public practice is engaged
to prepare financial statements. This section does not apply when an accountant
prepares financial statements
• and is engaged to perform an audit, review, or compilation of those
financial statements,
• solely for submission to taxing authorities,
• for inclusion in written personal financial plans prepared by the
accountant,
• in conjunction with litigation services that involve pending or potential
legal or regulatory proceedings, or
• in conjunction with business valuation services.
This section may also be applied, adapted as necessary in the circumstances, to
the preparation of other historical or prospective financial information.1 (Ref:
par. .A1)€”

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[FAR_WARS]

I suppose that makes sense. The question is actually asking about PREPARATIONS and the review is just filler. So SAARS would be used.

FAR- 80
BEC- 75
AUD- 78
REG- ?

[monikernc]

i pulled my responses to posts on interim financial statements in the Q3 Audit Review thread – lots of good info in there BTW – print the lists of standards, or have the page up in the browser, for quick reference.

a review of interim financial statements of a nonissuer requires an understanding of internal control. It is performed under AUC-930 which is an audit standard because they tie back to the full annual financial statements. You can find it here: https://www.aicpa.org/Research/Standards/AuditAttest/Pages/clarifiedSAS.aspx

AU722.10-14 review of interim financial statements of an issuer also requires an understanding of the entity and its internal controls because they tie back to the full annual financial statements.

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[payaza2000]

Doing the Becker SIMS on the Requirements for Reviews & Compilations; could someone point me to the authoritative literature that has information on the successor accountant communicating with predecessor accountant to obtain their working papers?

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[FAR_WARS]

@payaza

SSARS AR-400?

FAR- 80
BEC- 75
AUD- 78
REG- ?

[payaza2000]

Yeah sorry. I wasn't looking thoroughly enough, I was looking just at AR-C 80 & AR-C 90 For Reviews & Compilations.

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[Author]

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