AUDITING

Class BS Accounting and Finance

Instructor Mohsin Patel

Class details

Campus Main Campus (as per PO)

Session Day(s) Tuesdays and Thursdays

Credit Hours: 3 Credit Hours

Email [email protected]

Course Description

This course will provide an understanding of auditing and its process. The objectives include principles and
practices used by external auditors in examining financial statements and its supporting data. The course also
emphasizes ethical aspects related to the audit profession. The course will also help in understanding the role
and standards for auditing; which continue to evolve, and the traditional audit has changed in response to
factors such as technological advancement, the changing needs of financial information users, regulatory
changes and the increasingly litigious environment in which the auditors practice.

BS Accounting and Finance Program Learning Goals

1. Effective Communication Skills

Students will become effective speakers, listeners, writers and team members

2. Knowledge of Core Business Disciplines

Students will gain a broad based multidisciplinary exposure to a range of business disciplines

2. Critical Thinking
Students will develop the ability to analyze, synthesize and evaluate business theories models, frameworks
and contexts for Effective Decision making.

4. Ethics
Students will have an understanding and awareness of ethical frameworks and responsibilities

5. Glocal Mindset
Students will develop a focus on global connections and local Contexts through awareness of diversity across
cultures and markets

Course Learning Outcomes

Knowledge Outcomes
1. Understand the various steps required to carry out an external audit engagement from start to completion.
2. To develop an un-modified audit report.
3. Ability to hold discussion and form an opinion on ethical issues.

Skills/Abilities
The course will inculcate skills on decision-making, communication and analytical skills.
Ability to analyze and take decisions based on conflicting information.

Teaching and Learning Methodology

LMS will be used to share reading material with the students. The pedagogy used for the course is planned to
be a combination of:
- Slides
- Readings (online material / embedded in Slides)
- Assignments
- Quizzes
- Presentations – formal and informal
- Videos and their discussion
- Self-Study
- Online Interaction
- Exams

Course Learning Outcomes mapped to Program Goals

Knowledge of
Communication Glocal
Core Business Critical Skills Ethics
Skills Mindset
Program Goals Areas

Course
Learning
Outcomes

1 X X

2 X X

3 X X

Chapters/ Mapping to Course

Session Topic
Readings Learning Outcomes
Section-A, Principles & regulations of audit:
Chapters 1,2, CLO1 ▪ Organizations which affect the external auditing profession
in the global environment.
▪ Theories of Auditing: Agency theory, Policeman theory.
▪ Discussion about audit frameworks i.e. International
Auditing Standards and local laws applicable on auditing
profession
▪ Objectives, nature & principles of audit & other assurance
engagements,
▪ Discussion of Ethics and provisions of code of corporate
governance relevant to auditors
▪ The appointment, retention and removal of auditors as per
the local laws as applicable in Pakistan.
▪ Clients acceptance / Continuance Decisions

1
Section-B, CLO1 Scope of Internal Audit:
Chapters ▪ The structure, operations & need for internal audit
2,3,4,5 specially with reference to appropriate international codes
of corporate governance
▪ Explanation of the difference & relationship between
Internal & External audits
▪ The scope & limitations of internal audit function
▪ The nature & purpose of internal audit assignments
including Value for money audits, IT audits, Best value
audits & Financial audits
▪ The scope of operational internal audit assignments
including procurement etc.
Section-D, CLO1, Importance & significance of Internal Controls:
Chapters CLO3 ▪ Importance of Internal Control over financial reporting
2,3,4, ▪ What is COSO framework?
5,6 ▪ The purpose of internal controls, highlighting its five
components i.e. Control environment, risk assessment
process, information system, control activities &
monitoring of controls
▪ Management’s responsibility related to ICFR
▪ Auditor’s understanding of Internal controls & how
deficiencies in IC limit the extent of auditor’s reliance on
these systems
▪ Effectiveness of test of controls in determining suitability
& effectiveness of accounting & internal control systems
▪ Limitations of Internal controls with reference to fraud &
error & how audit strategy & plan can be modified following
the results of test of controls
▪ Discussion on reporting of significant deficiencies in IC &
recommendations to management for resolution of these
weaknesses

Section-E, CLO1, Audit Techniques:

Chapters CLO2 ▪ Importance & application of sampling in conducting audits
2,3,4, highlighting the difference & effectiveness of statistical &
5,6,7 Non-statistical sampling
▪ The usage of Computer-assisted audit techniques in audit
▪ Auditor’s reliance on work of experts & internal auditors &
the extent to which the reference to the work of others can
be made in the audit reports
▪ How the audit techniques differ between corporate sector &
Not-for-profit organizations?
▪ Taking auditing judgments, including judgment on
materiality
▪ Evaluation misstatements, aggregating and netting
misstatements, intentional misstatements

Section-F, CLO1 Audit Review and Ethical Dilemmas:

Chapters ▪ The purpose of review of subsequent events and how this
1,2,3,4 review can be conducted
▪ The need & responsibilities of auditor and management
with regard to going concern assumption
▪ The procedures & disclosures required in performing going
concern review & implications of this review
▪ Discussion of the quality & quantity of written
representations, highlighting the circumstances in which
representation is required
▪ The importance of the overall review of evidence obtained

2
 ▪ The significance & effect of dealing with uncorrected
misstatements
▪ Ethical Dilemmas faced by auditors

Section-G, CLO1, Reporting:

Chap. 1,2,3 CLO2 ▪ Description of format and contents of audit reports
▪ Reports to management regarding weaknesses in
accounting & internal control systems along with the
recommendations for improvement
▪ The format & contents of audit review reports.

Presentation CLO1, CLO2 Presentation by students

Text Book and Pre-Course Reading Material

Recommended Text Books

• ACCA - Audit & Assurance (INT) Study Text.
• ICAP - Auditing Study Text.
Secondary Texts
• Handbook of International Standards on Auditing (ISA).
• A risk based approach to conduct a quality audit, By: Johnstone, Gramling and Rittenberg.
• Companies Ordinance.

Prerequisite Skills and Knowledge to take this Course

Be comfortable with using technology for learning. There is a mobile and laptop usage policy.

Weightage
Assessment Remarks
tentative

Assignments to be submitted on time on the

Assignment 10%
relevant LMS tabs.
Coursera 5% Blended learning via Coursera Integration
Quizzes 15% Students need to revise the previous work.
CP 5% Separate information given below
Hourlies (Midterm / Final Exam) 65% Exams for this course.
Total: 100%

Class participation

At the end of physical sessions, might probably ask you to rate your own class participation, and I will also get
feedback from the entire class, on the students they have learnt the most from during the class. I will then
assess this information against my own observation, and then arrive at your final CP, however, the final veto
is of the Faculty.

1. Extremely Weak (0)

• You are consistently absent/late from class
• You attend class without showing any evidence of being ‘mentally’ present
• You show disrespectful behavior towards your peers

3
 2. Unsatisfactory (1)
• You are present and courteous, but do not participate very much in class even when
prompted.
• You hardly ever participate on LMS.
• You are essentially a passive recipient of information.
3. Satisfactory (2)
• You are present and courteous, but participate in class only when prompted.
• The above attitude is also reflected in your case study discussions, written work and LMS
discussions.

4. Good (3)
• You are present and courteous, and share actively regarding assigned readings/cases and
topics under discussion.
• The above attitude is also reflected in your case study discussions, written work and LMS
discussions.
• However, you participate in activities only when prompted.

5. Very Good - Almost There! (4)

• When you are present and courteous, and provide guidance to your fellow students during
discussion.
• This is also reflected in your case study discussions, written work and LMS discussions.
• You also participate in activities in a proactive manner.

6. Excellent - Exceptional in all Respects (5)

• You are present and courteous, and introduce new and thought provoking ideas, concepts
and issues in class.
• This is also reflected in your case study discussions, written work and LMS discussions.
• You initiate classroom activities and discussions, and contribute immensely to class
participation.
• Your classmates acknowledge your great contribution to their learning.

Comments and/or Suggestions

Students may meet the faculty in case of any problem or issue that needs attention.

Technology Requirements

As per course requirements. Also, keep your old-fashioned pen and paper handy.

Academic Conduct

As per IBA policy.

Attendance Policy

As per IBA policy.

Plagiarism Policy

As per IBA policy.