2024 The Role of Internal Control in the Risk-Based Audit

Overview

This program explores the role of client internal controls for balancing efficiency and effectiveness in a risk-based audit. We offer practical insights regarding an auditor's assessment of the risk of material misstatement when auditing financial statements of non-issuers, with particular emphasis on internal controls of small-to-medium clients.

Prerequisites

Basic working knowledge of financial statements

Objectives

• Identify minimum understanding and documentation requirements if the auditor does not intend to rely on internal controls
• Recognize internal controls of less-sophisticated, small-to-medium sized audit clients
• Utilize identified internal controls for an efficient, risk-based approach to audits conducted in accordance with generally accepted auditing standards
• Document your procedures and related conclusions

Highlights

• Specific matters auditors should consider when obtaining and documenting an understanding of the client's internal control system
• Development of a tailored audit approach that considers the potential reliance on internal controls
• Guidance for establishing an adequate basis for reliance on internal controls of less formal, smaller clients