ACA assurance Questions and Answers with complete solution

What's in an audit strategy - Answer-- broad scope - understand the entity - understand the accounting systems and internal control systems - identifying risk and setting materiality - nature, timing and extent of resources necessary - mgmt, direction and supervision of audit team Audit plan - Answer-- more detailed - nature, timing and extent of the specific audit PROCEDURES required for material issues - ensure appropriate attention is devoted to important areas of the audit - identify potential problems and resolve - ensure work is properly organised and managed (incl assign work to team members & facilitate supervision) Revenue system - Answer-1. ordering 2. despatch and invoicing 3. recording 4. cash collection Purchase system - Answer-1. ordering 2. goods received and invoiced 3. payment Payroll system - Answer-- calculating wages and salaries - recording - paymentWhat should be considered for sufficient evidence - Answer-sufficient quantity to support the audit - risk assessment - are the internal controls weak or strong? - materiality of the item - experience from past audits (particular issues) - results of audit procedures - source and reliability of info (quality) What should be considered for appropriate evidence - Answer-Relevant - evidence gathered must relate to FS assertions Reliable - external better than internal - internal more reliable when control are effective - auditor generated better than client generated - documented better than oral - og docs better than copies