New audit standards have been issued for assessing and responding to audit risk in financial statement audits. The new standards became effective on or after December 15, 2006. These new standards are intended to make sure that auditors have “sufficient knowledge of internal control to plan the audit. In addition, auditors need to understand how financial statement assertions should be linked to risks, internal controls, and application of audit procedures and conclusions.
I provide virtual support to CPAs relative to understanding these new standards and assisting with application to client situations.
The Audit Risk Standards:
· SAS no. 104, Amendment to Statement on Auditing Standards No. 1 Codification of Auditing Standards and Procedures (“Due Professional Care in Performance of Work”)
· SAS no. 105, Amendment to Statement on Auditing Standards No. 95, Generally Accepted Auditing Standards
· SAS no. 106, Audit Evidence
· SAS no. 107, Audit Risk and Materiality in Conducting an Audit
· SAS no. 108, Planning and Supervision
· SAS no. 109, Understanding the Entity and Its Environment and the Risks of Material Misstatement
· SAS no. 110, Performing Audit Procedures in Response to Assesses Risks and Evaluating the Audit Evidence Obtained
· SAS no. 111, Amendment to Statement on Auditing Standards No. 39, Audit Sampling
· SAS no. 112 Communication of Internal Control Related Matters Identified in an Audit
· SAS no. 115 Communication of Internal Control Related Maters Identified in an Audit (New)
I have conducted audits using these standards and linked them to the COSO framework which provides a solid foundation for helping you with audits and assessing internal control risk.
I can provide you with virtual support and even review your audit work papers if you need assistance. Please call me to explore ways that I can provide cost effective support to your auditing activities. Also, I have additional information on audit risk and related topics including “going concern” issues that can be downloaded.