FN0301 Auditing Process and Theory

Synopsis of Module

The module introduces students to auditing giving an insight into the practical aspects of how and why audits are performed and their role in UK corporate reporting together with an exploration of the theory supporting current audit practice and a critical appraisal thereof. The module will explore the nature and influence of audit risk on the modern audit and the key issues of audit independence and liability. Through the discipline of audit, students will develop their understanding of financial reporting, management accounting and basic economics. Students will also develop their ability to analyse and interpret financial and other key corporate information, and to critically appraise and discuss audit issues.

Module delivery includes lectures and seminars supported by directed learning through self-assessment.

Assessment will involve an unseen examination using a case study and essay questions

Aims of Module

The module aims to:

1.	Introduce students to auditing and, though the exploration of practical audit situations, develop their ability to plan and appreciate the issues in performing a risk based audit thus increasing their understanding of financial reporting issues

2.	Develop critical thinking through the evaluation of current audit issues.

Learning Outcomes

Students will be able to:

1.	Analyse an audit situation to identify audit risk.

2.	Select (and justify) appropriate audit techniques to obtain audit evidence to support the formulation of the audit opinion.

3.	Identify problems with current audit techniques and critically appraise proposals for improvement.

4.	Identify problems with the audit environment and critically appraise proposals to improve this.

Outline Syllabus

AUDIT IN CONTEXT

What is the role, purpose and value of audit? What does the audit report say? What is the role of the audit profession and what are the key professional ethical guidelines? What are the statutory rules governing audit?

AUDIT PROCESS

The identification of audit risk from knowledge of the business and the control environment. Planning the audit assignment.

The nature of audit evidence and the methods of collection including sampling, analytical review and auditing accounting estimates.

The audit of going concern.

Formulating and reporting an audit opinion.

CURRENT ISSUES IN AUDITING

The development of audit and the problems of independence.

Critical appraisal of audit techniques and audit standards.

Audit liability and its impact on the value of audit.

Summative assessment

Assessment A: Examination

The weighting of this assessment is 100%