Auditing and Internal Control

The indicative module outline is as follows:

The Regulatory and Conceptual Framework of Auditing: The demand for audit and assurance, the agency problem and the role of independent verification, the legal and regulatory environment of auditing, the structure of auditing standards (ISAs), the role of standard-setting bodies (IAASB, PCAOB), and the audit expectation gap.

Professional Ethics and Auditor Independence: The IESBA Code of Ethics for Professional Accountants, fundamental principles of professional conduct, threats to independence and safeguards, auditor rotation, non-audit services, and the regulatory response to independence failures, with reference to post-Enron reforms and the Sarbanes-Oxley Act.

Audit Engagement Acceptance and Planning: Client acceptance and continuance procedures, engagement letters, understanding the entity and its environment, preliminary analytical procedures, materiality determination, and the overall audit strategy and audit plan in accordance with ISA 300 and ISA 320.

Audit Risk Assessment: The audit risk model (inherent risk, control risk, detection risk), risk assessment procedures under ISA 315, identifying and assessing risks of material misstatement at the financial statement and assertion levels, significant risks, and fraud risk assessment under ISA 240.

Internal Control: Concepts and Frameworks: The purpose and components of internal control, the COSO Internal Control — Integrated Framework, control environment, risk assessment, control activities, information and communication, monitoring, and the limitations of internal control.

Evaluation of Internal Controls and Tests of Controls: Documenting and evaluating internal control systems using flowcharts and narrative descriptions, assessing design and operating effectiveness, tests of controls, the impact of control reliance on substantive procedures, and IT general and application controls.

Audit Evidence and Substantive Procedures: The nature, sufficiency, and appropriateness of audit evidence under ISA 500, types of audit procedures (inspection, observation, inquiry, confirmation, recalculation, reperformance, analytical procedures), and the design of substantive tests of details and substantive analytical procedures.

Audit of Specific Financial Statement Areas I: Audit of revenue and receivables (ISA 240, IFRS 15), audit of inventory and cost of sales (IAS 2), audit of property, plant and equipment (IAS 16), and audit of payables and accrued liabilities, including assertion-level testing and common audit procedures.

Audit of Specific Financial Statement Areas II: Audit of financial instruments and investments (IFRS 9), audit of provisions and contingent liabilities (IAS 37), audit of cash and bank balances, audit of related party transactions (ISA 550), and going concern assessment under ISA 570.

Completing the Audit and Audit Reporting: Subsequent events review (ISA 560), written representations (ISA 580), overall evaluation of audit findings, forming the audit opinion, structure and content of the auditor's report under ISA 700, modified opinions under ISA 705, emphasis of matter and other matter paragraphs under ISA 706, and communicating with those charged with governance under ISA 260.

Internal Auditing and Corporate Governance: The role and scope of internal auditing, the International Standards for the Professional Practice of Internal Auditing (IIA Standards), the relationship between internal and external audit, the role of the audit committee, and the contribution of internal audit to risk management and corporate governance frameworks.

Contemporary Issues in Auditing: Audit quality and its measurement, the future of the audit profession, the impact of data analytics, artificial intelligence, and continuous auditing on audit methodology, audit firm concentration and systemic risk, recent regulatory developments (BEIS reforms, EU Audit Regulation), and emerging challenges in auditing sustainability and non-financial information.