Psa 315
Psa 315
IDENTIFYING AND
ASSESSING THE RISKS OF
MATERIAL MISSTATEMENT
THROUGH
UNDERSTANDING THE
ENTITY AND ITS
ENVIRONMENT
PSA 315
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OBJECTIVE
FRAUD
UNDERSTANDING
Implemen
tation
IDENTIFY
ENTITY
Risks of
material
misstatement
ITS
ENVIRONMENT
INCLUDING
INTERNAL
CONTROL
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Design
Basis for
ASSESS
Responses to the
assessed risks of
material
misstatement
ERROR
DEFINITIONS
a)
b)
c)
d)
e)
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Assertions
Business risk
Internal control
Risk assessment procedures
Significant risk
REQUIREMENTS
Risk Assessment Procedures and Related Activities
The Required Understanding of the Entity and Its
Environment, Including the Entitys Internal Control
Identifying and Assessing the Risks of Material Misstatement
Material Weakness in Internal Control
Documentation
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REQUIREMENTS
Risk Assessment Procedures and Related Activities
The Required Understanding of the Entity and Its
Environment, Including the Entitys Internal Control
Identifying and Assessing the Risks of Material Misstatement
Material Weakness in Internal Control
Documentation
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The Entity
and Its
Environment
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Internal
Control
Relevant
industry,
regulatory, and
other external
factors including
the applicable
financial
reporting
framework.
Measuremen
t and review
of the
entitys
financial
performance.
Nature of the
Entity
The Entity
and Its
Environment
Objectives
and
Strategies
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Selection and
application of
accounting
policies
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Risk
Assessment
Internal
Control
Do you remember
your CRIME?
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Information
System
Components
Monitoring
Control
Environment
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REQUIREMENTS
Risk Assessment Procedures and Related Activities
The Required Understanding of the Entity and Its
Environment, Including the Entitys Internal Control
Identifying and Assessing the Risks of Material
Misstatement
Material Weakness in Internal Control
Documentation
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Assertion
Level
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Transactions
Account
balances
Disclosures
Basis for
designing
and
performing
further
audit
procedures
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REQUIREMENTS
Risk Assessment Procedures and Related Activities
The Required Understanding of the Entity and Its
Environment, Including the Entitys Internal Control
Identifying and Assessing the Risks of Material Misstatement
Material Weakness in Internal Control
Documentation
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REQUIREMENTS
Risk Assessment Procedures and Related Activities
The Required Understanding of the Entity and Its
Environment, Including the Entitys Internal Control
Identifying and Assessing the Risks of Material Misstatement
Material Weakness in Internal Control
Documentation
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DOCUMENTATION
The auditor shall document:
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Questions?
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