Risk Assessment & Responding to Risk

LEARNING FORMAT

On-demand video webinar. The date shown above is the expected release date of the on-demand module.

OBJECTIVES

Auditors must understand their audit clients in some depth, so that they can properly assess the risk of an error in the financial statements. This session will ensure individuals are aware of what issues may lead to a change in risk and consider how this is assessed as part of the ISA UK risk model and recorded in Inflo.

Once risk has been assessed, auditors need to understand how best to respond to risk, and the session will consider how the auditor might respond by designing appropriate tests.

KEY TOPICS

Risk assessment

• Refresher of audit assertions
• What does risk mean in the context of an audit? Why does it matter?
• How do we assess risk?
• Explanation of the risk model in audit work, including the spectrum of risk
• Understanding the entity, internal controls, business processes / walkthroughs and preliminary analytical review
• Financial statement level risks
• Assertion level risks
• Inherent risk vs Control risk
• Differentiation between scoping vs assessment of risk
• What a good risk assessment looks like
• Setting an overall risk level for the audit
• Changes to risk assessment / how to follow up on issues

Responding to risk

• Overview of requirement to respond to risk
• Linkage between risks and audit testing
• Impact of materiality on testing
• Different testing approaches
• Principal of directional testing and limitations of this model
• Link from assertion and assertion risks to design of testing

WHO SHOULD ATTEND

The course will be relevant to new accountants in their first year in practice.