ACA - Assurance Certificate (Questions + Answers) Verified 100% Correct!!.

CREST - Criteria (What are we testing against?) Report - Evidence Subject Matter (Vehicle, Financial Statement). Three party relationship When do we use MANICS - When we plan an assurance engagement. MANICS Acryonym - Management Integrity Adequate Resources Nature of Engagement Identification Communication Stability What is the purpose of an Engagement Letter? - Define Roles Provide Written Confirmation Three types of Audit Risk - Inherent Risk: Complex, Estimate, Industry Control Risk: Internal Controls not picking an issue up. Detection Risk: Why did Auditors not pick up error? Significant Risk - Risks with a high likelihood. We need to identify these in the planning stage and allocate more work to it. What are Analytical Procedures? - A comparison of two data sets. We compare it to something else.Strategy Analysis vs Plan Analysis - Strategy: Scope, Timing, Direction Plan: Nature, Timing, Extent What is an Audit plan? - It is a massive list of tests that we need to carry up. What are limitations to Internal Controls? - - How much the control costs . - Human Error - Collusion on payroll - Unusual transactions Key Components of Internal Control (CRIME) - C - Control Activity (What are we actually doing to prevent Fraud) R - Risk Assessment I - Information System M - Monitoring Internal Controls E - Environment of control. Do Directors care? Positive and Negative Requests A/R - Positive Request - A response required. Ask customer to state balance. Negative Request - No Reply necessary. Customer only replies if they disagree with balance Obtaining Audit Evidence Acronym (AEIOR) - Analytical Procedures Enquiry Inspection Observation Recalculation