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22522 Assurance Services and Audit

Warning: The information on this page is indicative. The subject outline for a particular session, location and mode of offering is the authoritative source of all information about the subject for that offering. Required texts, recommended texts and references in particular are likely to change. Students will be provided with a subject outline once they enrol in the subject.

Subject handbook information prior to 2018 is available in the Archives.

UTS: Business: Accounting
Credit points: 6 cp

Subject level:

Undergraduate

Result type: Grade and marks

Requisite(s): 22320 Accounting for Business Combinations AND 22420 Accounting Standards and Regulations
These requisites may not apply to students in certain courses.
There are course requisites for this subject. See access conditions.

Description

This subject addresses the provision of assurance services, specifically reasonable assurance over the general purpose financial statements of an entity. The subject examines the history and origins of the audit and then moves on to the examination of contemporary audit practices. During the subject, students are exposed to the entire audit process – from gathering an understanding of the client's operations and risks, planning and then executing an audit and reporting on their findings to relevant parties. The subject provides an understanding of professional, ethical and legal requirements and responsibilities in completing and reporting on assurance tasks. It is accredited by the accounting professional bodies.

Subject learning objectives (SLOs)

Upon successful completion of this subject students should be able to:
1. Explain the role of auditors and auditing in providing financial statement audits on the information contained within firms' annual financial reports
2. Demonstrate practice-based methodologies necessary to provide assurance and audit services in conjunction with the criteria used to measure information quality and authenticity, especially in the areas of risk assessment, audit planning, audit execution and the formulation of opinions
3. Analyse and evaluate the professional legal and ethical requirements and responsibilities in completing and reporting on assurance and audit tasks
4. Demonstrate an ability to work effectively with others as a member of an assurance/audit team in designing audit tasks and making judgments, and in communicating assurance/auditing findings to appropriate users in multiple communication formats that are part of the global business environment

Course intended learning outcomes (CILOs)

This subject also contributes specifically to the following program learning objectives:

  • Use oral communication appropriately to convey information clearly and fluently (3.2)
  • Critically analyse business decisions in terms of ethical practice and social responsibility (4.1)
  • Apply technical and professional skills necessary to operate effectively in business and related professions (5.1)

Contribution to the development of graduate attributes

This subject imparts both a theoretical foundation of auditing as well as practical skills necessary to work effectively as a graduate auditor in an assurance team. It gives students an understanding of the essential role that assurance services, such as auditing, play in business in achieving good corporate governance by ensuring the integrity of information and internal control systems. It also provides students with training in real audit scenarios and procedures by working individually and in teams to solve complex audit issues.

This subject contributes to the development of the following graduate attributes:

  • Communication and interpersonal skills
  • Attitudes and values
  • Business practice oriented skills

Teaching and learning strategies

This subject uses both teacher and student led approaches to help students understand and apply the concepts of assurance and auditing. Lectures are used to convey important theoretical and practical concepts as well as providing students with the opportunity to work together in designing problems and applying the theory to solve those problems. Lectures are interactive and contain written, audio and video content. Tutorials are designed to provide active learning experiences for students.

Student preparation outside of class

This subject does not contain traditional homework questions from a textbook. Instead, students should use their time outside of the classroom to review, revise and understand the week’s lecture content using lecture videos, YouTube videos, online self-testing quizzes and other materials on UTSOnline so that when they attend tutorials, they can put their learning into practice.

Tutorials and in-class activities

The first component of every tutorial provides students with the opportunity to demonstrate their understanding of the week’s content by completing a number of problem questions individually. The second component of the tutorial will have students analysing their responses to the problem questions in groups and coming to a consensus on what the most appropriate answer to the problem question will be. These two components of class are assessable (see Assessment Task 2). One student from each group will also give a brief 2-3 minute presentation of their answer to a specific problem to the class (see Assessment Task 1, Component A) and the tutor will facilitate a discussion based on these presentations.

This method of active learning is called Peer Instruction and more information can be found in the Teaching & Learning Strategies folder in the Course Information section on UTSOnline.

Getting support

To accommodate the wide variety of student learning styles – support is available to students in multiple ways. These methods include:

  • Annotated recordings of lectures
  • YouTube videos
  • Staff consultation sessions
  • UTSOnline Discussion Board
  • Auditing Flip Board online magazine
  • Social media channels – the latest news and current events related to auditing are also distributed to students via Facebook, Twitter and the Announcements page on UTSOnline

Content (topics)

  • Understanding of the basic principles of assurance and the assurance environment.
  • Identifying an entity's risks and controls as part of audit planning and strategy.
  • Gathering evidence to support the auditor's opinion
  • Completing the audit and communicating the findings of the audit with stakeholders and the entity

Assessment

Assessment task 1: Presentation skills (Individual)

Objective(s):

This addresses subject learning objective(s):

2, 3 and 4

This addresses program learning objectives(s):

3.2

Weight: 30%

Assessment task 2: Weekly in-class quiz (10% Individual and 10% Group)

Objective(s):

This addresses subject learning objective(s):

1, 2, 3 and 4

Weight: 20%

Assessment task 3: Final Exam (Individual)

Objective(s):

This addresses subject learning objective(s):

1, 2 and 3

This addresses program learning objectives(s):

4.1 and 5.1

Weight: 50%

Minimum requirements

To pass this subject, students must obtain a total assessment mark of 50/100 or greater.

To gain a pass in a supplementary examination or other assessment tasks, a student must achieve at least 50% in that supplementary exam or assessment task.

Required texts

  • Gay & Simnett (2017) Auditing & Assurance Services in Australia, 6th Edition REVISED, McGraw Hill.

The text used in this course is the REVISED 6th Edition - we recommend students purchase the REVISED edition for a text that is up to date. Students may wish to purchase older editions at their own risk. Electronic and hard copies of the text are available. Follow the link on UTSOnline to purchase an electronic textbook.

Students are also required to read the Australian Auditing Standards (ASAs) throughout the course. These can be downloaded from the AUASB website at no cost, therefore students are not required but encouraged to purchase the Auditing Handbook.
Students will be provided with a list of the ASAs they will need to refer to in the course, along with a link to the site where they can be downloaded.

References

  • Bell TF, Peecher ME and I Solomon The 21st Century Public Company Audit: Conceptual Elements of KPMG's Global Audit Methodology KPMG LLP
  • Bell T F Marrs I Solomon H Thomas [1997] Auditing Organisations Through a Strategic-Systems Lens KPMG Peat Marwick LLP
  • Committee of Sponsoring Organisations of the Treadway Commission [1992] Internal Control - An Integrated Framework
  • CPA Australia Quality Control Management in Accounting Practices: Guidance Manual for Practitioners
  • Greenstein M and M Vasarhelyi [2002] Electronic Commerce: Security Risk Management,and Control2 McGraw-Hill
  • Hall J A [2000] Information Systems Auditing and Assurance South-Western College Publishing Cincinnati Ohio
  • Watts R and Z Zimmerman [1986] Positive Accounting Theory Prentice Hall (Chapter 13)
  • Weber R [1999] Information Systems Control and Audit Prentice Hall Sydney
  • Wilkinson J W and M J Cerullo [1997] Accounting Information Systems Wiley 3 edition
  • Wright M [1999] Auditing in an IT Systems Environment Audit Guide No 5 Australian Accounting Research Foundation Melbourne

Other resources

Articles

  • Getting Technical [1996] Auditing Issues: Auditing Investments under CHESS Charter pp 62 & 63
  • Fargher N L and A A Gramling [1996] A New Market for Attestation Services: The Performance Presentation Standards of the Association for Investment Management and Research Auditing: A Journal of Practice and Theory 15 Supplement
  • Greinke A and G Shailer [1997] Auditing the Auditors - The Esanda Case Australian Accountant (Now Australian CPA) 67 7 August pp 16 -18
  • Watts R and Z Zimmerman [1983] Agency Problems Auditing and the Theory of the Firm Journal of Law and Economics 26 pp 613-634

Websites

Legislation

  • Corporations Act 2001
  • Competition and Consumer Act 2010 (replacing the Trade Practices Act 1974)

Reading the Professional and Financial Press
Students should also be aware of new ideas practices and topical issues. Australian professional body journals the Australian CPA and Charter, business and trade magazines such as The Business Review Weekly and the financial press such as the Australian Financial Review, Sydney Morning Herald and The Australian are very useful in being aware of topical issues and in understanding practical aspects of this subject as well as business and professional views on auditing. Auditing: A Journal of Practice and Theory is another interesting source to gain a broader understanding of auditing.

Social Media

Students have access to the latest updates and news within the discipline through social media - this can be accessed through Twitter, Facebook and UTSOnline. Students are expected to check regularly for articles and links that the subject coordinator posts and follow those links through to the related material. See the external links area on UTSOnline to click through to the relevant Twitter and Facebook accounts/pages.