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Auditing Developments

Exam Questions: 80
Course Level: Basic
Pages: 452 | Content: 436, Supplemental: 16
NASBA Area of Study: Auditing
Not Acceptable for: Enrolled Agents
Version: 7580C

The objective of this course is to address the latest developments affecting 2020 and 2021 audit engagements, including the impact of COVID-19 on audit engagements. Topics include: addressing the auditor's consideration of the business and economic environment in which the client operates; accounting and auditing engagement issues during COVID-19, including the impact of the pandemic on an entity's ability to continue as a going-concern; client and employee fraud; specific accounting risks for auditors to consider; limiting auditor's liability; key audit focus areas during volatile times; lessons from litigation; efficiency engagements to reduce auditor time; various practice issues related to audits; dealing with DOL audits of employee benefit plans, and more. Additionally, in this course, auditors will learn about the new auditor's report, auditing estimates, and audit evidence guidance found in SAS Nos. 134-143, and the new attestation standards found in SSAE Nos. 19-22. The course focuses on recalling, recognizing, and identifying rules related to auditing standards, including new developments pertaining to those standards. PLEASE NOTE: Not accepted for Enrolled Agents. All course material provided. No prerequisites. Course level: Basic.

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Course Information

Table of Contents
  • Introduction
  • Implications of the Current Economic Environment for Auditors
  • Accounting Issues Related to the Coronavirus (COVID-19)
  • Auditing Engagement Issues- COVID-19
  • Going Concern and COVID-19
  • Client and Employee Fraud
  • Specific Accounting Risks for Auditors to Consider for 2020-2021 Audits
  • Attempting to Limit Auditor's Liability
  • Impact of Going-Concern Report Modifications
  • Retaliation Against Auditors Who Issue Adverse Opinions
  • Restatements
  • Key Focus Areas for the Auditor in Volatile Times
  • Lessons from Litigation
  • Efficient Engagements- Reduce Time, Make More Money without Increasing Risk
  • Practice Issues Related to Auditing
  • Communicating Internal Control Related Matters Identified- Audit AU-C 265
  • Watch Out for the DOL and Audits of Employee Benefit Plans
  • Why Do Individuals Cheat and Commit Fraud?
  • Signing at the Beginning of a Document- Decreasing Dishonest Self Reports
  • Auditing Standards Board (ASB) Agenda
  • PCAOB and SEC Approve Naming Engagement Partners in Audit Engagements
  • Recent Auditing Standards
  • Recent Attestation Standards
Objectives
  • To identify an example of a concentration which might require disclosure
  • To recall the definition of near term
  • To identify the net operation loss rules under the CARES Act
  • To recognize a key characteristic of a multi-employer pension plan
  • To identify the most obvious approach to account for a PPP loan under GAAP
  • To recall how an entity should account for PPP loan forgiveness
  • To identify a scenario in which it would be impracticable for an auditor to attend a physical inventory
  • To recognize an advantage of remote auditing
  • To recognize a behavioral trait of most occupational fraudsters
  • To recognize the difference between fraud and an error
  • To recall the three conditions of the fraud triangle
  • To identify common types of financial statement fraud noted by the FBI
  • To recognize an example of a misappropriation of assets
  • To recognize a factor to consider in evaluating going concern of an entity
  • To recall how an investment in equity security should be accounted for under GAAP
  • To recognize the new sales tax rules in the wake of the Wayfair decision
  • To recognize an example of a coverage ratio
  • To recall the timeframe within which most lawsuits against auditors occur
  • To identify a recommendation to tighten up auditor workpapers
  • To identify a suggestion for an auditor to reduce time and increase audit efficiency
  • To recognize when negative accounts receivable confirmations should not be used
  • To identify the form of a comfort letter that would be appropriate for an accountant to make to a lender
  • To recall the rule for an auditor presenting his or her city and state on the audit report
  • To identify the rules of an auditor communicating deficiencies found in an audit
  • To recognize an example of a result that can occur if there is a problem with a DOL employee benefit plan audit
  • To identify a type of fraudster
  • To recall the location of certain sections in the auditor's report
  • To recognize the categorization of an adverse opinion
  • To identify a change that SAS No. 136 makes to the limited-scope ERISA audit
  • To recognize one of the changes made by AU-C 703 to ERISA audits
  • To recall the reporting requirement when an auditor obtains other information in an audit
  • To identify a reference that is made in the new definition of materiality
  • To recognize the definition of certain types of paragraphs made by SAS No. 139
  • To recognize an example of an attribute of information obtained as audit evidence per SAS No. 142
  • To identify an attribute of audit evidence referenced in SAS No. 142
  • To identify how inherent and control risk should be assessed under the SAS No. 143 requirements
  • To recall the three approaches that an auditor can use to perform further audit procedures required by SAS No. 143
  • To identify a change made by SSAE No. 19
  • To recognize one of the four types of engagements within SSAE No. 21's new definition of attestation engagement
  • To identify an example of subject matter that is within the scope of SSAE No. 22's review

PLEASE NOTE: CPE credit measurement is based on NASBA Registry and QAS guidelines of one credit for every 50 minutes. Credit calculation may vary in different states — check with your State Board of Accountancy. Unless otherwise noted in the specific course description, no advanced preparation is required in order to register or complete any PES CPE course. Use of materials or services provided by Professional Education Services, LP ("PES") are governed by the Terms and Conditions stated on PES' website www.mypescpe.com. PES provides these courses with the understanding that it is not providing any accounting, legal, or other professional advice and assumes no liability whatsoever in connection with its use. PES has used diligent efforts to provide quality information and material to its customers, but does not warrant or guarantee the accuracy, timeliness, completeness, or currency of the information contained herein. Ultimately, the responsibility to comply with applicable legal requirements falls solely upon the individual licensee, not PES. PES encourages you to contact your state Board for the latest information and to confirm or clarify any questions or concerns you have regarding your duties or obligations as a licensed professional.