193 paragraphs found
Incentives for fraudulent financial reporting by employees may exist where compensation schemes are dependent on returns made from the use of financial instruments. Understanding how an entity’s compensation policies interact with its risk appetite, and …
Difficult financial market conditions may give rise to increased incentives for management or employees to engage in fraudulent financial reporting: to protect personal bonuses, to hide employee or management fraud or error, to avoid breaching regulatory, …
Misappropriation of assets and fraudulent financial reporting may often involve override of controls that otherwise may appear to be operating effectively. This may include override of controls over data, assumptions and detailed process controls that …
The auditor’s assessment of the identified risks at the assertion level in accordance with ASA 315 includes evaluating the design and implementation of internal control. It provides a basis for considering the appropriate audit approach for designing and …
The auditor’s assessment of the risk of material misstatement at the assertion level may change during the course of the audit as additional information is obtained. Remaining alert during the audit, for example, when inspecting records or documents may …
An expectation that controls are operating effectively may be more common when dealing with a financial institution with well-established controls, and therefore controls testing may be an effective means of obtaining audit evidence. When an entity has a …
Entities with a high volume of trading and use of financial instruments may have more sophisticated controls, and an effective risk management function, and therefore the auditor may be more likely to test controls in obtaining evidence about: The …
In those entities with relatively few financial instrument transactions: Management and those charged with governance may have only a limited understanding of financial instruments and how they affect the business; The entity may only have a few different …
When an entity has relatively few transactions involving financial instruments, it may be relatively easy for the auditor to obtain an understanding of the entity’s objectives for using the financial instruments and the characteristics of the instruments. …