DESCRIPTION
This module provides participants prepares participants to perform analytical procedures in an audit, including preliminary, substantive, and final analytics. Participants will discuss factors influencing the design of a substantive analytical procedure, including sources of data and documentation requirements. The classroom discussions will also highlight how taking a storytelling approach can improve the documentation and performance of substantive analytical procedures. The module includes a case study focused on the use of substantive analytical procedures to test expense accounts, allowing participants to practice applying the concepts covered during the module to designing audit tests of the general and administrative expenses of an example company.
LEARNING OBJECTIVES
- Identify audit areas where substantive analytical procedures could provide sufficient appropriate audit evidence
- Design an effective substantive analytical procedure by evaluating key factors, including data reliability, expectation precision, and disaggregation
- Evaluate the results of substantive analytical procedures by critically assessing variances and determining if additional procedures are required
- Document substantive analytical procedures clearly to comply with professional standards and facilitate effective supervision and review
