Course Description

This course is designed to orient the students in the application of the audit standards techniques and procedures in the risk-based audit process. The course will
cover the stages of the risk-based audit process, namely risk assessment (preliminary engagement activities, planning the audit and performance of the risk
assessment procedures) and risk response (designing and tests of controls and substantive test of transactions in the revenue and collection cycle, expenditure
cycle and financing and investing cycle. The application of audit procedures in performing substantive tests of transactions and account balances of cash,
receivables and sales shall also be included.

I. COURSE LEARNING OUTCOMES

Upon completion of the course, the students will be able to:

Cognitive
1. Explain the nature of financial statements audit.
2. Explain and apply the GAAS in audit engagement.

Psychomotor
1. Prepare audit working papers and audit reports

Affective
1. Support the vision, mission and goals of the University, the College and the Department
2. Appreciate the importance of integrity and reliability in financial reporting and be able to explain why they are needed.
3. Acknowledge the importance of audited financial statements.
4. Comply with auditing standards in the execution of audit engagements.

II. TEXTBOOK(S) AND REFERENCE(S)

References : Financial Accounting Volumes 1, 2 and 3

 By: Conrado T. Valix , Jose F. Peralta and Christian Aris Valix
2015 Edition

Applied Auditing
By: Ma. ElenitaBalatbat Cabrera
2015 Edition

Theory of Accounts
By: Condrado T. Valix
2015 Edition, Manila, Phil.

Practical Accounting 1
By: Condrado T. Valix
2014 Edition

Practical Accounting 1
By: CondrdadoUberita
2014 Edition

Note on textbook(s) and reference(s): The teacher reserves the right to choose the textbook(s) and reference(s) he/she deems
appropriate.

III. DETAILED COURSE OUTLINE/LEARNING PLAN

WK HRS TOPIC LEARNING OUTCOMES STRATEGIES/ACTIVITIES ASSESSMENT OF LEARNING

OUTCOMES
1 1.5   
1-2 3 Review of overview of auditing

 Definition  Explain the nature of  Lecture  Quiz on the topic

 Objective and general financial statements audit  Recitation  Assignment
principles of auditing  Explain the objectives of  Sharing of insights
 The audit process auditing
 Major steps in the  Explain the ten generally
systematic process of accepted auditing
financial statements audit standards
 Phase I: Pre-  Explain the major phases
engagement and audit in the audit process
planning activities
 Phase II: gathering
and evaluating audit
evidence, interim audit
phase, final audit
phase
 Phase III: Issuing the
audit report

2-3 3 Audit Planning

 Purposes  Explain the nature and  Lecture  Quiz on the topic

 Audit planning objectives of audit  Recitation  Assignment
considerations planning  Sharing of insights
 Knowledge of the  Explain the steps in the
business assessment of inherent
 Understanding the risk and control risk in
accounting and audit
internal control system  Explain the procedure in
 Assessment of risk developing a preliminary
and materiality, audit program
application of  Explain the basics of audit
 analytical procedures, planning
coordination, direction,
supervision, and
review, other critical
matters in engagement
planning, planning the
audit work

3-5 9 Evidence accumulation and

evaluation-interim audit phase: test
of controls and substantive tests of
transactions

 Audit of the revenue and  Compute the amounts to  Lecture  Quiz on the topic
collection cycle: test of be presented on the  Recitation  Assignment
controls and substantive financial statement  Sharing of insights
test of transactions  Prepare necessary  Problem-based discussion
 Nature, documents journal entries
used and their audit  Identify required
significance, disclosure
accounting records in  Explain the nature of the
the revenue and revenue, collection,
collection cycle expenditure, financing
 Audit of significant and investing cycle
sales transactions  Describe the major
 Audit of sales classes of transactions in
adjustments the revenue, collection
transactions expenditure, financing
 Audit of cash receipts and investing cycle
transactions  Identify essential
 Audit of the expenditure elements of internal
cycle: test of controls and control over sales, sales
substantive test of adjustments, cash
 transactions- I receipts, purchases, cash
 Nature of expenditure disbursements, payroll,
cycle, documents used production, financing and
and their audit investing transactions
significance,  Explain how to apply
accounting records compliance test of
involved in the controls over the revenue,
expenditure cycle collection, expenditure,
 Audit of acquisitions financing and investing
and cash cycle transactions
disbursements
transactions
 Audit of cash
disbursements
 Audit of production
cycle transactions
 Audit of inventory
warehousing

6 2 PRELIMINARY EXAMINATION
6-8 9  Audit of the expenditure  Explain how to apply
cycle: test of controls and compliance test of
substantive test of controls over the,
transactions- II expenditure, financing
 Audit of payroll and investing cycle
transactions transactions
 Audit of the financing and
investing cycle: test of
controls and substantive
test of transactions
 Audit of the financing
cycle
  Audit of investing cycle

8-12 9 Evidence accumulation and

evaluation-final audit phase:
substantive test of balances and
analytical procedures- PART I

 Substantive tests of cash  Compute the amounts to  Lecture  Quiz on the topic
 Substantive tests of be presented on the  Recitation  Assignment
receivables and sales financial statement  Sharing of insights
 Prepare necessary  Quiz-based discussion
journal entries
 Identify required
disclosure
 Explain the nature of
substantive test of
transactions and balances
 Explain the auditor’s
objectives for the
substantive audit of cash
in bank and on hand and
of trade accounts and
notes receivables and
sales transactions
 Explain the nature of the
appropriate audit
procedures to accomplish
the objectives for audit of
cash and trade accounts
and notes
  Explain the preparation of
audit working papers to
document the audit
procedures for cash,
receivables and sales

12 2 MIDTERM EXAMINATION
13- 13.5 Evidence accumulation and
17 evaluation-final audit phase:
substantive test of balances and
analytical procedures- PART II

 Substantive tests of  Compute the amounts to  Lecture  Quiz on the topic

inventories and cost of be presented on the  Recitation  Assignment
goods sold financial statement  Sharing of insights
 Substantive tests of  Prepare necessary  Quiz-based discussion
investments journal entries
 Substantive tests of  Identify required
property, plant, and disclosure
equipment  Explain the nature of
substantive test of
transactions and balances
 Explain the auditor’s
objectives for the
substantive audit of
inventories, cost of goods
sold, investments, and
property, plant and
equipment
 Explain the nature of the
appropriate audit
procedures to accomplish
the objectives for audit of
 inventories, cost of goods
sold, investments,
property, plant and
equipment.
 Explain the preparation of
audit working papers to
document the audit
procedures for
inventories, cost of goods
sold, investments, and
property, plant and
equipment.

18 2 FINAL EXAMINATION