Auditor's Risk Assessment Process: Tackling the New Risk Assessment SASs

The risk assessment standards in SAS Nos. 104 through 111 substantially impact the way audits are performed. They represent a major shift in the auditor's risk assessment process for audits of nonpublic entities. The requirements and guidance will result in more effective audits by enhancing the auditor's application of the audit risk model in practice. Learn the requirements that significantly enhance the quality and depth of the understanding of the entity and its environment, including its internal control system. Gain an understanding of how the risk assessment standards differ from previous standards in conducting an audit — both during the interim and final field work phases. Learn what procedures are required to respond to assessed risks. Also learn how the documentation standards in SAS No. 103 and the required communication of internal control related matters in SAS No. 115 fit into the typical audit process.

• Recognize how the risk assessment standards differ from previous standards and how these differences will significantly affect your audit practice
• Develop a more in-depth understanding of the entity and its environment, including its system of internal control
• Identify the risks of material misstatement in the financial statements and what the entity is doing to mitigate them
• Provide a more rigorous assessment of the risks of material misstatement
• Improve the linkage between the assessed risks and the nature, timing and extent of audit procedures performed in response to those risks

Prerequisite: Basic understanding of accounting and auditing principles