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Acronyms provided by Alison Dundjerovic, a Kaplan Financial tutor, to help students in memorising F8 issues.

ACCA fundamental principles of code of ethics: COPIC C Competence: professional knowledge and skill O Objectivity: should not allow bias, conflicts of interest or undue influence of others P Professional behaviour I Integrity: straightforward and honest C Confidentiality Auditors consideration deciding whether to accept an audit assignment: PLACE P Professional clearance: writing to the leaving auditor L Legal considerations: anything that would prevent auditor from doing the job legally; e.g. licensing A Auditor considerations: resources, time, skills C Commercial considerations: e.g. KOB E Ethical consideration Situations where an auditor leaves: 3Rs R Resign R Retire R Removal Factors auditor consider before relying on other peoples work: STRIP S Scope of work T Technical competence R Report quality I Independence P Professionalism Limitations of internal controls: FAME F Fraudulent collusion A Abuse of authority M Management authority E Errors What are the financial statement assertions: V COD RACE V Valuation C Completeness: all transactions that should be included, actually included? O Occurrence D Disclosure R Rights and obligations A Accuracy

C Cut-off E Existence: actually exists? Method of tests that the auditor can use: AEIOU + CR A Analytical review E Enquiry: ask client I Inspection: e.g. NCA O Observation: watch when it actually happens U Recalculation: e.g. depreciation, interest + C Confirmation: by third party; e.g. lawyers, bank, receivables R Re-performance: e.g. stock count General substantive tests that can be used by the auditor: A TOAD A Add-up T Trial balance O Opening balance to last years closing (compare) A Audit software D Disclosure check Specific tests can be used for receivables: 3Cs C Circularisation C Cut-off C Cash paid after the y/e Specific tests can be used for trade payables: CRAP C Cut-off R Reconcile supplier statement A Analytical procedure P Post year ending invoice review Company objectives for internal controls: AS PIE A Accurate accounting records S Safeguard the assets P Prevent and detect fraud I Internal policy followed E Efficiency General controls expected in an organisation: - Good recruitment procedures - Good training procedures - Internal audit department

- Management of 3As: Attitude, Awareness, Action - Incentives Specific controls expected in an organisation: ACCA MAPS A Authorisation C Comparison: i.e. analytical review C Computer controls: e.g. passwords A Arithmetic: i.e. add-up M Maintain a trial balance A Accounting reconciliations P Physical controls S Segregation of duties What should be present in a panning document: MARK SAT M Materiality and tolerable error A Analytical review R Risk K Knowledge of business S Staffing A Audit approach T Timetable

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