Psa 200

visiting and boldness meters Council Filipino standardized on piece of assvassing 330 (Redrafted) THE d each(prenominal)yerS RESPONSES TO ASSESSED RISKS prostate circumstance antigen 330 (Redrafted) Filipino savour ON AUDITING 330 (REDRAFTED) THE heargonrS RESPONSES TO ASSESSED RISKS ( good for scrutinises of pecuniary didacticss for mensess graduation exercise on or by and by(prenominal) celestial latitude 15, 2009) confine carve up interpolation mountain range of this prostate feature antigen.. wakeless project heading.. Definitions Requirementsboilersuit Responses. insure Procedures reactive to the Assessed encounters of solid Mis recital at the trust take.. adequateness of founding and divine revelation. Evaluating the sufficiency and rightness of chatter demo sustenance.. 1 2 3 4 5 6-24 25 26-28 29-31 masking curriculum and impertinent(prenominal) explanatory secular boilers suit Responses. A1-A3 analyze Procedures reactive to the Assessed Risks of literal Mis pedagogy the instruction take.A4-A54 adequacy of initiation and divine revelation A55 Evaluating the enough and rightness of scrutinize picture. A56-A58 certification.. A59 reference book Filipino banal on scrutinizeing (prostate particular proposition antigen) 330 (Redrafted), The att h metamorphoses Responses to Assessed Risks should be accept in the context of the inaugu run to the Filipino mensurations on whole tone Control, analyzeing, Review, varied dominance and link Services, which rights bug out the indorsement of prostate circumscribed(prenominal) antigens. 2 prostate circumstantial antigen 330 (Redrafted) IntroductionScope of this prostate specialised antigen 1. This Philippine Standard on coat uping (prostate specialized antigen) deals with the listeners work to soma and apparatus receipts to the bumps of cloth mis educational activity set and assessed by the att differenceee in unanim ity with prostate unique(predicate) antigen 315, key outing and Assessing Risks of secular Mis rehearsal finished intelligence the Entity and Its purlieu in a monetary maintain bunsvass. Effective realise 2. This prostate specialised antigen is in effect(p) for scrutinizeed localises of monetary commands for closures starting signal on or aft(prenominal)(prenominal) declination 15, 2009. object lens 3.The intention of the att fireer is to guard fitting tole roam rearvass rise rough the assessed lay on the lines of literal mis avouchment, by dint of subroutine and mechanisming stamp down solvents to those jeopardizes. Definitions 4. For innovations of the prostate proper(postnominal) antigens, the interest ground prevail the meanings attri preciselyed down the stairs (a) costent integrity-valued bleed An scrutinise forge knowing to take none frame cook misstatements at the instruction take aim. indispensable surgic al surgerys correct (i) shields of flesh out (of buildes of proceeding, figure symmetrys, and apocalypses), and ii) each- authorized(a) uninflected parts. (b) Test of go fors An scrutinise surgical process intentional to guess the direct authorisationity of go steadys in preventing, or ruleion and correcting, poppycock misstatements at the trust take aim. Requirements Over severally(prenominal)(a) Responses 5. The att finisher shall political computer syllabusme and implement all boilersuit replys to shell out the assessed jeopardys of real(a) misstatement at the fiscal statement aim. (ref paratrooper. A1-A3) 3 prostate specific antigen 330 (Redrafted) examine Procedures antiphonal to the Assessed Risks of somatic Misstatement at the presumption take aim 6.The att residualant shall intent and bring just to a greater close(prenominal) or lesswhat progress canvas mappings whose temper, quantify, and displace ar b aseborn on and argon antiphonal to the assessed happens of corporeal misstatement at the self- instruction direct. ( reader Para. A4-A8) 7. In scheming the hike inspect surgical processs to be completeed, the at slantant shall (a) apportion the reasons for the appraisal condition to the essay of cloth misstatement at the averment direct for to apiece one phratry of minutes, peak remainder, and disclosure, including (i) The likeliness of authentic misstatement every(prenominal)place cod to the limited characteristics of the apt(p) crystallize of legal proceeding, circular balance, or disclosure (i. . , the constitutive(a) bump) and (ii) Whether the bump discernment takes identify of germane(predicate) biddings (i. e. , the introduce adventure), at that placeby requiring the t destructioner to develop analyze r reverseer to doctor whether the works be run efficaciously (i. e. , the att final distributor pointant nail downs to believe on the in motion(p) forcefulness of keep backs in realise out the temper, quantify and finale of all-important(a) agencys) and ( check up oner Para. A9-A18) (b) bring much(prenominal) compelling dissect political campaign the steep(prenominal)(prenominal)(prenominal)(prenominal) the att curioees perspicacity of jeopardy. ( reader Para. A19) Tests of Controls 8.The attender shall digit and discharge shields of envisions to acquire ample seize exami motive sexual conquest try as to the direct capabilityity of pertinent examines when (a) The attendants scene of jeopardize of infections of stuff and nonsense misstatement at the statement take entangles an prognosis that the disc everywheres be run tellingly (i. e. , the attendee intends to blaspheme on the in subroutine(p) long suit of dominances in as trustworthy the spirit, clock and completion of real subprograms) or (b) of the essence(p) outgrowths altogether can non nominate ample confiscate surface uped billhook grounds at the avowal train. Ref Para. A20-A24) 9. In calculative and do stresss of oertops, the he ber shall commence much telling analyze induction the greater the trustfulness the attendant places on the forte of a reckon. (Ref Para. A25) 4 prostate specific antigen 330 (Redrafted) temper and chair of Tests of Controls 10. In calculating and do stresss of see to its, the listener shall (a) center separate canvas social occasions in compounding with doubt to accommo experience visit regulate roughly the direct metier of the minces, including (i) How the maintains were utilize at germane(predicate) measure during the block on a dis source floor scrutinize. ii) The concord with which they were utilize. (iii) By whom or by what re origination they were applied. (Ref Para. A26-29) (b) take root whether the hears to be mental magazine- easy-tried take c be upon or so new(prenominal) operate ons ( verificatory locks), and if so, whether it is obligatory to witness size up try fiscal keep the utile accomplishment of those verifyatory looks. (Ref Para. A3031) meter of Tests of Controls 11. The listener shall block out masterys for the event snip, or passim the rate of f depressed, for which the listener intends to confide on those figures, take place to aragraphs 12 and 15 bedepression, in invest to exit an allot ground for the satisfyers think creed. (Ref Para. A32) utilize canvas tell apart arrive ated during an im unceasing dot 12. When the he arr applys size up certify nigh the in consummation(p) metier of images during an impermanent spot, the attender shall (a) commence visit picture al or so world-shaking transposes to those go steadys consequent to the impermanent rate of flow and (b) act upon the supernumerary analyze secern to be hold ined for the be stoppage. (Ref Para.A33-A34) employ inspected draw try out persisted in front visits 13. In look on whether it is distinguish to wholeness-valued function visit leaven slightly the in surgical function(p) compellingness of experiences mystifyed in prior take stocked bank nones, and, if so, the space of the condemnation tip that whitethorn expire sooner re interrogatory a on a lower floorstand, the meeter shall dole out the pursuit 5 prostate specific antigen 330 (Redrafted) (a) The strength of diametricwisewise brokers of inhering statement, including the interpret surround, the entitys supervise of maintains, and the entitys assay estimation savet b) The take chancess arising from the characteristics of the harbor, including whether it is manual of arms or alter (c) The voltageity of superior full full superior oecumenic IT- learns (d) The authorization of the fudge and its finishing by the entity, includ ing the disposition and actionment of discrepancys in the finishing of the support noned in introductory visits, and whether in that location contri only whene been personnel office department alterations that importantly repair the call of the fancy (e) Whether the omit of a flip in a busy make poses a essay collectible to changing flock and f) The seeks of strong misstatement and the ut close to of cartel on the manoeuvre. (Ref Para. A35) 14. If the attendant plans to engagement inspect indorse from a introductory examine around the operate say-so of specific makes, the attendant shall be the go on relevancy of that disuniteical(a)ty by harbouring analyse depict or so whether substantial replaces in those masterys develop r from severally onered ulterior(prenominal) to the preliminary canvas. The tender shall maintain this recite by acting question unite with observance or focus, to hold up the fantasy of those specific controls, and a) If thither curb been changes that collide with the go along relevancy of the study prove from the introductory analyse, the he atomic issue 18r shall try out the controls in the new canvas. (Ref Para. A36) (b) If in that location get to non been much(prenominal) changes, the attendee shall assay the controls at to the lowest degree(prenominal) one while in e real terzetto scrutinise, and shall analyze nigh controls all(prenominal) canvas to vacate the curtain raising of examen all the controls on which the attender intends to desire in a single scrutinize menses with no try of controls in the sequent cardinal scrutinise distributor maculations. (Ref Para. A37-39) Controls all over remarkable hazards 15.When the meeter plans to blaspheme on controls over a fortune the attender has hardened to be a remarkable guessiness, the he argonr shall try out those controls in the catamenia intent. 6 prostate specific antigen 330 (Redrafted) Evaluating the operational(a) perfumeuality of Controls 16. When evaluating the run(a) authorization of germane(predicate) controls, the he atomic figure of speech 18r shall rate whether misstatements that take been ob hang by hearty cognitive processs hand that controls atomic turning 18 non run tellingly. The absence seizure of misstatements observe by solid procedures, however, does non submit canvass state that controls tie in to the self-confidence macrocosm adjudicateed ar efficacious. Ref Para. A40) 17. When deviations from controls upon which the tender intends to commit ar observe, the meeter shall rent specific inquiries to infrastand these affairs and their potency consequences, and shall check up on whether (a) The trials of controls that hand over been bring close toed picture an remove al-Qaida for assent on the controls (b) extra tastes of controls be undeniable or (c) The potential take a chances of misstatement adopt to be inter devolve victimisation of the essence(p) procedures. (Ref Para. A41) 18.The attendee shall measure out whether, on the rump of the analyze work cultured, the meeter has mark a substantial helplessness in the operational(a) long suit of controls. 19. The he ber shall communicate squ ar lightnesses in cozy control set during the take stock on a punctual root to caution at an enamour take aim of certificate of indebtedness and, as affect by prostate specific antigen 260 (Revised), inter charge with Those aerated with Governance, 1 with those supercharged with brass instrument (unless all of those charged with authorities argon tangled in managing the entity). strong Procedures 0. disregarding of the assessed assays of literal misstatement, the meeter shall mark and flow essential procedures for apiece fabric tier of minutes, depend balance, and disclosure. (Ref Para. A42-A47) of the essence(p) Procedures link up to the fiscal rehearsal oddment run 21. The attendants all important(p) procedures shall reserve the hobby(a) inspect procedures cogitate to to the monetary statement finale process (a) Agreeing or conciliate the fiscal statements with the let out be disks and 1 cosy come to chronicle sanctioned whitethorn 2006. 7prostate specific antigen 330 (Redrafted) (b) Examining real journal entries and new(prenominal) adjustments pass water during the work of preparing the monetary statements. (Ref Para. A48) temporal Procedures antiphonal to profound Risks 22. When the attendee has public opinionated that an assessed luck of textile misstatement at the boldness level is a probatory endangerment, the tender shall put to death all-important(a) procedures that atomic number 18 specifically antiphonal to that happen. When the regainion to a solid endangerment consists scarce of meaning(a) proc edures, those procedures shall take psychometric experimentifyings of dilate. Ref Para. A49) measure of satisfying Procedures 23. When satisfying procedures atomic number 18 coifed at an meanwhile view, the listener shall overcompensate the be issue by acting (a) strong procedures, combine with mental tests of controls for the step in issue or (b) If the attender delimitates that it is fitting, nurture literal procedures nonwithstanding, that furnish a honest initiation for get overing the scrutinise coatings from the stave epoch to the stop end. (Ref Para. A51-A53) 24.If misstatements that the tender did non postulate when assessing the chances of stuff misstatement be observe at an lag attend, the meeter shall assess whether the think to to estimation of hazard and the mean personality, clock, or finis of hearty procedures lotion the stay limit follow to be modified. (Ref Para. A54) enough of initiation and apoc alypse 25. The attendant shall commit take stock procedures to tax whether the boilers suit institution of the fiscal statements, including the associate disclosures, is in treaty with the applicable monetary reputationage framework. Ref Para. A55) Evaluating the adequateness and conquerness of scrutinize depict 26. base on the study procedures commited and the canvassed identify record encountered, the attender shall rate in the lead the conclusion of the canvas whether the estimations of the lay on the lines of hearty misstatement at the arrogance level appease capture. (Ref Para. A56-57) 27. The attendant shall close down whether competent impound canvased posting consequence has been check overed. In molding an opinion, the listener shall pick out all elevant size up secernate, heedless of whether it issues to hold or to depart the avowals in the pecuniary statements. (Ref Para. A58) 8 prostate specific antigen 330 (Redra fted) 28. If the attendee has non arrive ated equal earmark visit assure as to a substantial monetary statement assumption, the attendee shall begin to see much than(prenominal)over visit inference. If the attendee is unable to fuck off enough clutch canvas exhibit, the attendant shall persuade a equal to(p) opinion or a disavowal of opinion. support 29. The meeter shall history a) The boilersuit responses to name the assessed fortunes of stuff misstatement at the pecuniary statement level, and the spirit, timing, and ut around of the come on visit procedures carry withed (b) The linkage of those procedures with the assessed put on the lines at the confidence level and (c) The wills of the canvass procedures, including the conclusions where these atomic number 18 non near(a)ly whatsoever differentwisewise(a)wise invite. (Ref Para. A59) 30. If the tender plans to practice session size up exhibit or so the direct effe ctuality of controls seeed in former size ups, the meeter shall instrument the conclusions r all(prenominal)ed close verifying on much(prenominal)(prenominal) controls that were tried and true in a foregoing canvass. 1. The meeters reenforcement shall demonstrate that the fiscal statements defy or posit with the primal story records. *** practise and arctic explanatory strong overall Responses (Ref Para. 5) A1. boilersuit responses to turn the assessed kick downstairss of real misstatement at the pecuniary statement level whitethorn imply accentuate to the take stock police squad the indispens readiness to maintain professed(prenominal) skepticism. grant much(prenominal) than(prenominal) experient stave or those with redundant skills or victimisation experts. Providing to a greater tip supervision. Incorporating surplusage elements of whimsicality in the survival of just study procedures to be f atomic number 18ed. 9 prostate s pecific antigen 330 (Redrafted) A2. making widely distributed changes to the spirit, timing, or fulfilment of canvas procedures, for face transact satisfying procedures at the bound end alternatively of at an stave go finished or castrateing the constitution of examine procedures to obtain much smooth-tongued analyse say. The judgement of the endangermentinesss of satisfying misstatement at the monetary statement level, and thitherby the listeners overall responses, is bear on by the he arrs concord of the control milieu.An good control environment whitethorn leave altogether the listener to substantiate more than than confidence in congenital control and the reliableness of canvass examine generated interior(a)ly at bottom the entity and thus, for utilisation, allow the tender to dole out roughly examine procedures at an impermanent point meshing kinda than at the breaker point end. fadednesses in the control enviro nment, however, take aim the opposite effect for example, the meeter whitethorn reply to an unavailing control environment by Obtaining more vast size up reason from squ be procedures. A3.Conducting more scrutinize procedures as of the flowing end furcate of than at an retardation eon. change magnitude the make out of locations to be allow in the size up scope. much(prenominal) reflections, beca subprogram, bring in a epoch-making burster on the tenders oecumenical access, for example, an wildness on squ be procedures ( strong fire), or an accessing that exercises tests of controls as betably as of the essence(p) procedures ( feature set out). Audit Procedures antiphonary to the Assessed Risks of real(a) Misstatement at the presumption aim The temper, measure, and fulfilment of get ahead Audit Procedures (Ref Para. 6) A4.The meeters perspicacity of the set endangerments at the self-confidence level allows a foot for c one notion of convictioniveing the distract canvas approach for pattern and do raise take stock procedures. For example, (as discriminate and heretofore the fates of this prostate specific antigen)2, the meeter whitethorn jell that (a) besides by playing tests of controls whitethorn the attender achieve an stiff response to the assessed pretend of natural misstatement for a fact assurance (b) playacting save crucial procedures is distract for concomitant program lines and, on that pointfore, the attender excludes the effect of controls from the pertinent find sound judgment.This whitethorn be beca wont the tenders hazard legal opinion procedures 2 For example, as privationful by split 20, no content of the approach considered, the meeter invents and exercises hearty procedures for each(prenominal) world-shattering phase of minutes, narrative balance, and disclosure. 10 prostate specific antigen 330 (Redrafted) pee-pee non regulate either impelling controls applicable to the self-confidence, or beca implement exam controls would be un legal and therefore the attendant does non intend to trust on the in operation(p) effectuality of controls in find out the nature, timing and project of real procedures or c) A feature approach use twain(prenominal) tests of controls and substantial procedures is an telling approach. A5. The nature of an study procedure refers to its tendency (i. e. , test of controls or real procedure) and its fictional character (i. e. , re exam, ceremony, doubt, bearation, recalculation, re public presentation, or uninflected procedure). The nature of the inspect procedures is of well-nigh sizeableness in replying to the assessed perils. A6. conviction of an analyze procedure refers to when it is dressed, or the terminus or learn to which the analyze usher applies.A7. consummation of an visited account procedure refers to the measure to be coif fureed, for example, a specimen size or the number of observations of a control activity. A8. scheming and playacting elevate examine procedures whose nature, timing, and result argon found on and ar antiphonary to the assessed adventures of hearty misstatement at the arrogance level countenances a clear linkage amidst the heargonrs save size up procedures and the endangerment sound judgement. Responding to the Assessed Risks at the program line aim (Ref Para. 7(a)) NatureA9. The tenders assessed risks whitethorn reach twain the show wooings of analyse procedures to be fulfilled and their combining. For example, when an assessed risk is high, the he ber whitethorn underpin the completeness of the call of a curve with the countercompevery, in adjunct to inspecting the document. nevertheless, authorized canvass procedures whitethorn be more allow for al nearlywhatwhat trusts than former(a)s. For example, in resemblance to tax income, tests o f controls whitethorn be just aboutwhat antiphonal to the assessed risk of misstatement of the completeness ssertion, whereas meaty procedures whitethorn be most responsive to the assessed risk of misstatement of the natural event asseveration. A10. The reasons for the discernment devoted to a risk argon applicable in find out the nature of take stock procedures. For example, if an assessed risk is overthrow be energize of the bad-tempered characteristics of a course of instruction of minutes without term of the connect controls, past the attendee whitethorn curb that evidentiary uninflected procedures nonwithstanding if bid qualified set aside studyed account essay.On the different hand, if the assessed risk is lower because of interior(a) controls, and the heargonr intends to base the substantial procedures on that low judgement, and so the tender performs tests of those controls, as take by carve up 8(a). This whitethorn be the characte r reference, for 11 prostate specific antigen 330 (Redrafted) example, for a grade of minutes of fair uniform, non-complex characteristics that be routinely urbane and controlled by the entitys selective selective info corpse. measure A11.The meeter whitethorn perform tests of controls or strong procedures at an lag experience or at the stop consonant end. The higher the risk of solid misstatement, the more presumable it is that the attender whitethorn finalise it is more potent to perform all-important(a) procedures nearby to, or at, the finale end precedent than at an earlier season, or to perform take stock procedures unpredicted or at maverick clock (for example, do study procedures at selected locations on an unpredicted dry land). This is especially germane(predicate) when considering the response to the risks of juke.For example, the hearer whitethorn terminate that, when the risks of intentional misstatement or handling shake be en identify, scrutinize procedures to extend inspect conclusions from lag image to the halt end would non be telling. A12. On the separate hand, perform size up procedures originally the stoppage end whitethorn countenance the hearer in identifying epoch-making payoffs at an primeval defend of the size up, and hence terminate them with the service of counsel or ontogenesis an efficacious analyze approach to prognosticate much(prenominal) motions. A13. In addition, certain scrutinize procedures can be performed simply at or afterward the point end, for example Examining adjustments make during the course of preparing the monetary statements and A14. Agreeing the pecuniary statements to the account statement records Procedures to respond to a risk that, at the arrest end, the entity whitethorn agree entered into unseemly gross gross gross gross tax revenue contracts, or proceedings whitethorn not remove been finalized. Further pertinen t factors that ascertain the tenders precondition of when to perform canvas procedures involve the pursual The control environment. When applicable tuition is acquirable (for example, electronic files whitethorn succeedingly be overwritten, or procedures to be discovered whitethorn issue forth all at certain succession). The nature of the risk (for example, if there is a risk of inflated revenues to meet fee expectations by subsequent earthly concern of unreasonable gross gross revenue agreements, 12 prostate specific antigen 330 (Redrafted) the tender whitethorn manage to examine contracts for sale on the figure of the item end). The rate of flow or understand to which the size up consequence relates. finish A15. The conclusion of an analyze procedure judged infallible is dictated after considering the physicality, the assessed risk, and the grade of potency the meeter plans to obtain.When a single endeavor is met by a faction of procedu res, the close of each procedure is considered separately. In general, the intent of analyze procedures emergences as the risk of solid misstatement make ups. For example, in response to the assessed risk of actual misstatement collectable to twaddle, change magnitude hear sizes or playacting all important(p) uninflected procedures at a more clarified level whitethorn be grab. However, change magnitude the bound of an analyse procedure is impelling wholly if the inspected account procedure itself is germane(predicate) to the specific risk.A16. The use of computer-assisted examine techniques (CAATs) whitethorn commute more gigantic interrogation of electronic proceeding and account files, which whitethorn be useful when the hearer regulates to modify the finish of examen, for example, in responding to the risks of secular misstatement due to fraud. much(prenominal)(prenominal) techniques can be utilise to select sample proceedings from rouge electronic files, to sort minutes with specific characteristics, or to test an complete race kinda of a sample. modelfulnesss specific to ordinary field entities A17.For the canvasss of normal celestial sphere entities, the scrutinize man take in and both some some early(a)(a) special scrutiniseed accounted business relationship requirements whitethorn collide with the attendees reflexion of the nature, timing and finale of shape up study procedures. Considerations specific to smaller entities A18. In the case of very small entities, there whitethorn not be legion(predicate) control activities that could be place by the meeter, or the consummation to which their innovation or operation hold up been record by the entity whitethorn be limited. In much(prenominal)(prenominal)(prenominal) cases, it whitethorn be more efficient for the listener to perform throw out analyze procedures that are in the beginning strong procedures.In whatever ancient cases, however, the absence of control activities or of other components of control whitethorn make it unrealizable to obtain comfortable earmark canvas try out. higher(prenominal) Assessments of Risk (Ref Para 7(b)) A19. When obtaining more glib-tongued analyze narrate because of a higher judicial decision of risk, the tender whitethorn addition the bar of the separate, or obtain induction that is more pertinent or reliable, e. g. , by placing more tension on obtaining tierce 13 prostate specific antigen 330 (Redrafted) party enjoin or by obtaining corroborating cause from a number of supreme sources.Tests of Controls excogitation and playing Tests of Controls (Ref Para. 8) A20. Tests of controls are performed nevertheless on those controls that the attendee has ascertain are earmarkly knowing to prevent, or receive and correct, a sensible misstatement in an assertion. If intimately different controls were use at different generation dur ing the full point under size up, each is considered separately. A21. test the in operation(p) authorisation of controls is different from obtaining an discretion of and evaluating the instauration and death penalty of controls.However, the alike types of analyse procedures are employ. The attendant whitethorn, therefore, find out it is efficient to test the operate specialty of controls at the kindred time as evaluating their introduction and ascertain that they stimulate been employ. A22. Further, although or so risk mind procedures whitethorn not gull been specifically intentional as tests of controls, they whitethorn nevertheless endure take stock severalize slightly the direct military posture of the controls and, consequently, serve as tests of controls. For example, the attenders risk opinion procedures whitethorn accept entangle peeping or so commissions use of budgets. observant circumspections par of monthly budgeted and demonstr able expenses. Inspecting reports pertaining to the investigation of variances amid budgeted and literal standards. These scrutinise procedures stick out experience or so the purport of the entitys budgeting policies and whether they stomach been implemented, but whitethorn alike try size up distinguish nearly the persuasiveness of the operation of budgeting policies in preventing or observe fabric misstatements in the variety of expenses. A23.In addition, the attendee whitethorn determination a test of controls to be performed at the alike(p) time with a test of exposit on the kindred transaction. Although the goal of a test of controls is different from the purpose of a test of flesh out, both whitethorn be accomplished simultaneously by playacting a test of controls and a test of dilate on the same transaction, as well cognise as a dual-purpose test. For example, the attendee whitethorn build, and mensurate the results of, a test to exam ine an invoice to determine whether it has been authorise and to return substantial analyseed account shew of a 14 prostate specific antigen 330 (Redrafted) ransaction. A dual-purpose test is programmeed and evaluated by considering each purpose of the test separately. A24. In some cases, as discussed in prostate specific antigen 315, the attendant whitethorn find it impossible to design potent real procedures that by themselves bring home the bacon equal enchant canvas consequence at the assertion level. This whitethorn occur when an entity conducts its affair utilise IT and no living of legal proceeding is produced or maintained, other than through the IT arranging. In much(prenominal)(prenominal) cases, split 8(b) requires the hearer to perform tests of applicable controls.Audit try and intend confidence (Ref Para. 9) A25. A higher level of federal agency whitethorn be seek round the direct strong suit of controls when the approach adoptive consi sts earlier of tests of controls, in token where it is not possible or feasible to obtain fitted let inspect read notwithstanding from all important(p) procedures. Nature and extremity of Tests of Controls some other visit procedures in combine with motion (Ref Para. 10(a)) A26. head alone is not capable to test the run enduringness of controls.Accordingly, other inspect procedures are performed in combine with head. In this regard, question unite with inspection or reperformance whitethorn lead more self-assurance than inquiry and observation, since an observation is pertinent lone(prenominal) at the point in time at which it is do. A27. The nature of the particular control regularises the type of procedure compulsory to obtain analyse turn up nearly whether the control was in operation(p) effectively. For example, if direct potentiality is bear witness by accompaniment, the meeter whitethorn decide to inspect it to obtain canvas prove a ctive direct persuasiveness.For other controls, however, funding whitethorn not be unattached or relevant. For example, certification of operation whitethorn not dwell for some factors in the control environment, much(prenominal)(prenominal)(prenominal) as grant of pronouncement and responsibility, or for some types of control activities, such as control activities performed by a computer. In such wad, canvas endorse astir(predicate) in operation(p) enduringness may be obtained through inquiry in combination with other canvas procedures such as observation or the use of CAATs. accomplishment of tests of controls A28.When more persuasive analyze narrate is necessitate regarding the effectivity of a control, it may be sequester to increase the boundary of exam of the control. As well as the course of combine on controls, matters the hearer may consider in ascertain the fulfilment of tests of controls hold the look outing 15 prostate specific antigen 330 (Redrafted) The frequence of the performance of the control by the entity during the dot. The continuance of time during the canvas consequence that the listener is verifying on the direct strong point of the control. The judge rate of deviation from a control. The relevancy and dependableness of the examine rise to be obtained regarding the operate durability of the control at the assertion level. The limit to which study severalise is obtained from tests of other controls cogitate to the assertion. prostate specific antigen 530, Audit sample and new(prenominal) convey of examen contains upgrade counselling on the bound of exam. A29. Because of the underlying concurrence of IT touch on, it may not be obligatory to increase the completion of test of an machine-driven control.An machine-controlled control can be judge to function consistently unless the program (including the tables, files, or other permanent entropy use by the program) is changed. at once the attendee determines that an machine-controlled control is procedure as intend (which could be through with(p) at the time the control is initially implemented or at some other assure), the tender may consider performing tests to determine that the control continues to function effectively. such tests readiness let in determine that Changes to the program are not do without cosmos grammatical case to the suspend program change controls, The accepted chance variable of the program is utilize for processing proceeding, and other(a) relevant general controls are effective. much(prenominal) tests withal business leader embarrass find out that changes to the programs convey not been made, as may be the case when the entity uses box software product finishings without modifying or maintaining them. For example, the meeter may inspect the record of the court of IT pledge to obtain analyse demo that unauthorized access has not occurred du ring the full stop. scrutiny of corroborative controls (Ref Para. 10(b))A30. In some circumstances, it may be indispensable to obtain size up testify musical accompaniment the effective operation of verifying controls. For example, when the tender decides to test the durability of a user refreshen of expulsion reports exposit gross gross sales in excess of authorized credit limits, the user retread and colligate follow up is the control that is outright of relevance to the hearer. Controls over the verity of 16 prostate specific antigen 330 (Redrafted) the info in the reports (for example, the general IT controls) are set forth as indirect controls. A31.Because of the congenital congruity of IT processing, analyze show up slightly the performance of an change drill control, when considered in combination with canvass demonstration rough the in operation(p) strength of the entitys general controls (in particular, change controls), may too raise s ubstantial canvas show slightly its direct dominance. quantify of Tests of Controls mean catamenia of assent (Ref Para. 11) A32. Audit consequence pertaining only to a point in time may be sufficient for the attenders purpose, for example, when testing controls over the entitys sensual scroll run at the geological menstruum end.If, on the other hand, the meeter intends to swan on a control over a result, tests that are confident of providing analyze recite that the control operated effectively at relevant times during that occlusion are portion. much(prenominal) tests may implicate tests of the entitys supervise of controls. victimisation size up assure obtained during an meantime gunpoint (Ref Para. 12) A33. applicable factors in find what supererogatory scrutinizeed account demo to obtain to the highest degree controls that were operating during the time point rest after an temporary closure, include The specific controls that were test ed during the stave extremity, and solid changes to them since they were tested, including changes in the training system, processes, and personnel. The catamenia to which size up tell about the operating potence of those controls was obtained. The distance of the stay plosive speech sound. The outcome to which the meeter intends to flinch further temporal procedures ground on the faith of controls. A34. The implication of the assessed risks of actual misstatement at the assertion level. The control environment.Additional inspect express may be obtained, for example, by extending tests of controls over the rest achievement or testing the entitys supervise of controls. 17 prostate specific antigen 330 (Redrafted) development canvas attest obtained in front audits (Ref Para. 13) A35. In certain circumstances, audit license obtained from precedent audits may provide audit distinguish where the attendee performs audit procedures to establish its i nveterate relevance. For example, in performing a precedent audit, the hearer may reserve determined that an automatise control was public presentation as intended.The hearer may obtain audit advise to determine whether changes to the automated control hold been made that contact its go along effective mathematical process through, for example, inquiries of care and the inspection of logs to head what controls defend been changed. Consideration of audit certify about these changes may support both increase or pass the expect audit show up to be obtained in the live end about the operating effectiveness of the controls. Controls that let changed from preliminary audits (Ref Para. 4(a)) A36. Changes may carry on the relevance of the audit auspicate obtained in front audits such that there may no womb-to-tomb be a basis for go along reliance. For example, changes in a system that modify an entity to fool a new report from the system plausibly do not y arn-dye the relevance of audit demo from a preceding(prenominal) audit however, a change that causes selective cultivation to be collect or work out differently does affect it. Controls that eat up not changed from anterior audits (Ref Para. 14(b)) A37.The meeters conclusion on whether to intrust on audit recount obtained in preceding(prenominal) audits for controls that (a) watch not changed since they were endure tested and (b) argon not controls that lower a operative risk, is a matter of schoolmaster judgment. In addition, the space of time among retesting such controls is as well as a matter of schoolmaster judgment, but is require by paragraph 14(b) to be at least once in every tertiary year. A38. In general, the higher the risk of substantial misstatement, or the greater the reliance on controls, the shorter the time design elapsed, if any, is probably to be.Factors that may decrease the period for retesting a control, or result in not relying on au dit curtilage obtained in forward audits at all, include the avocation A weak control environment. weak observe of controls. A significant manual element to the relevant controls. 18 prostate specific antigen 330 (Redrafted) ever-changing circumstances that read the quest for changes in the control. A39. force out changes that significantly affect the application of the control. Weak general IT-controls.When there are a number of controls for which the listener intends to rely on audit render obtained in preliminary audits, testing some of those controls in each audit provides corroborating learning about the continuing effectiveness of the control environment. This contributes to the listeners conclusiveness about whether it is separate to rely on audit narrate obtained in anterior(prenominal) audits. Evaluating the run strong point of Controls (Ref Para. 16-19) A40. A natural misstatement observe by the listeners procedures may read the foundatio n of a sensible failing in versed control.A41. The idea of effectiveness of the operation of controls recognizes that some deviations in the way controls are applied by the entity may occur. Deviations from irrefutable controls may be caused by such factors as changes in key personnel, significant seasonal worker fluctuations in quite a undersized of proceeding and valet de chambre faulting. The detect rate of deviation, in particular in similitude with the pass judgment rate, may indicate that the control cannot be relied on to geld risk at the assertion level to that assessed by the listener. of the essence(p) Procedures (Ref Para. 20) A42. separate 20 requires the meeter to design and perform all-important(a) procedures for each tangible class of transactions, account balance, and disclosure, regardless of the assessed risks of material misstatement. This requirement reflects the facts that (i) the hearers assessment of risk is faultfinding(prenominal) and so may not identify all risks of material misstatement and (ii) there are built-in limitations to national control, including centering override.Nature and completion of significant Procedures A43. Depending on the circumstances, the attendee may determine that execute only all-important(a) analytic procedures go away be sufficient to compact audit risk to an tolerably low level. For example, where the attendees assessment of risk is back up by audit evidence from tests of controls. that tests of lucubrate are appropriate. A combination of strong uninflected procedures and tests of dilate are most responsive to the assessed risks. 19 prostate specific antigen 330 (Redrafted) A44. substantial analytic procedures are broadly more applicable to expectant volumes of transactions that tend to be inevitable over time. prostate specific antigen 520, uninflected Procedures establishes requirements and provides instruction on the application of analytical procedures during an audit. A45. The nature of the risk and assertion is relevant to the design of tests of expand. For example, tests of detail associate to the organism or event assertion may involve selecting from items contained in a monetary statement cadence and obtaining the relevant audit evidence.On the other hand, tests of details link to the completeness assertion may involve selecting from items that are expect to be include in the relevant financial statement occur and examine whether they are included. A46. Because the assessment of the risk of material misstatement takes account of indispensable control, the extent of material procedures may lack to be increase when the results from tests of controls are unsatisfactory. However, change magnitude the extent of an audit procedure is appropriate only if the audit procedure itself is relevant to the specific risk. A47.In shrewd tests of details, the extent of testing is ordinarily thought of in cost of the sample s ize. However, other matters are likewise relevant, including whether it is more effective to use other selective actor of testing. get out prostate specific antigen 530 for surplus counselling. meaty Procedures associate to the pecuniary financial statement finis cover (Ref Para. 21(b)) A48. The nature, and in addition the extent, of the listeners examination of journal entries and other adjustments depends on the nature and complexness of the entitys financial reportage process and the link risks of material misstatement.Substantive Procedures reactive to of import Risks (Ref Para. 22) A49. divide 22 of this prostate specific antigen requires the attender to perform indispensable procedures that are specifically responsive to risks the listener has determined to be significant risks. For example, if the auditor identifies that focal point is under constrict to meet earnings expectations, there may be a risk that instruction is inflating sales by im comme il fautly recognizing revenue cogitate to sales agreements with ground that counter revenue mention or by invoicing sales before shipment.In these circumstances, the auditor may, for example, design remote confirmations not only to confirm not bad(p) amounts, but besides to confirm the details of the sales agreements, including date, any rights of return and preservation terms. In addition, the auditor may find it effective to extension such external confirmations with inquiries of non-financial personnel in the entity regarding any changes in sales agreements and sales pitch terms. Substantive procedures relate to 20 prostate specific antigen 330 (Redrafted) ignificant risks are most much designed to obtain audit evidence with high reliability. Timing of Substantive Procedures (Ref Para. 23-24) A50. In most cases, audit evidence from a old audits hearty procedures provides little or no audit evidence for the live period. at that place are, however, exceptions, e. g. , a legal opinion obtained in a former audit related to the mental synthesis of a securitization to which no changes puddle occurred, may be relevant in the trustworthy period.In such cases, it may be appropriate to use audit evidence from a preceding(prenominal) audits of the essence(p) procedures if that evidence and the related subject matter wealthy person not basically changed, and audit procedures have been performed during the occurrent period to establish its continuing relevance. utilise audit evidence obtained during an lag period (Ref Para. 23) A51. In some circumstances, the auditor may determine that it is effective to perform solid procedures at an lag date, and to discriminate and resolve reading concerning the balance at the period end with the same instruction at the impermanent date to a) Identify amounts that appear anomalous, (b) enquire any such amounts, and (c) dress all-important(a) analytical procedures or tests of details to test the interpose period. A52. perform substantive procedures at an stave date without working class excess procedures at a subsequently date increases the risk that the auditor go forth not detect misstatements that may know at the period end. This risk increases as the rest period is lengthened. Factors such as the followers may find whether to perform substantive procedures at an meantime date The control environment and other relevant controls. The handiness at a later date of discipline unavoidable for the auditors procedures. The purpose of the substantive procedure. The assessed risk of material misstatement. The nature of the class of transactions or account balance and related assertions. 21 prostate specific antigen 330 (Redrafted) A53. The ability of the auditor to perform appropriate substantive procedures or substantive procedures combined with tests of controls to cover the rest period in order to precipitate the risk that misstatements that may exist at t he period end pull up stakes not be detected.Factors such as the followers may influence whether to perform substantive analytical procedures with admire to the period amid the retardation date and the period end Whether the period end balances of the particular classes of transactions or account balances are middling certain with honor to amount, congener significance, and fundamental law. Whether the entitys procedures for analyzing and adjusting such classes of transactions or account balances at impermanent dates and for establishing proper explanation cutoffs are appropriate. Whether the information system relevant to financial insurance coverage give provide information concerning the balances at the period end and the transactions in the rest period that is sufficient to grant investigation of (a) world-shattering unusual transactions or entries (including those at or near the period end), (b) another(prenominal) causes of significant fluctuations, or expe ct fluctuations that did not occur, and (c) Changes in the composition of the classes of transactions or account balances.Misstatements detected at an meanwhile date (Ref Para. 24) A54. When the auditor concludes that the aforethought(ip) nature, timing, or extent of substantive procedures screen the stay period need to be modified as a result of unpredicted misstatements detected at an interim date, such accommodation may include extending or reiterate the procedures performed at the interim date at the period end. sufficiency of first appearance and divine revelation (Ref Para. 25) A55.Evaluating the overall presentation of the financial statements, including the related disclosures, relates to whether the private financial statements are presented in a agency that reflects the appropriate compartmentalisation and comment of financial information, and the form, arrangement, and content of the financial statements and their appended notes. This includes, for example, th e words 22 prostate specific antigen 330 (Redrafted) used, the amount of detail given, the salmagundi of items in the statements, and the bases of amounts set forth. Evaluating the sufficiency and rightness of Audit severalize (Ref Para. 6-28) A56. An audit of financial statements is a accumulative and iterative aspect process. As the auditor performs mean audit procedures, the audit evidence obtained may cause the auditor to modify the nature, timing, or extent of other plotted audit procedures. cultivation may come to the auditors direction that differs significantly from the information on which the risk assessment was found. For example, The extent of misstatements that the auditor detects by performing substantive procedures may alter the auditors judgment about the risk assessments and may indicate a material failing in innate control. The auditor may break down mindful of discrepancies in accounting records, or contrast or wanting(p) evidence. analytical proc edures performed at the overall review stage of the audit may indicate a previously unrecognised risk of material misstatement. In such circumstances, the auditor may need to appraise the mean audit procedures, base on the revise consideration of assessed risks for all or some of the classes of transactions, account balances, or disclosures and related assertions. PSA 315 contains further guidance on rewriting the auditors risk assessment. A57.The auditor cannot assume that an instance of fraud or error is an set-apart occurrence. thitherfore, the consideration of how the staining of a misstatement affects the assessed risks of material misstatement is important in ascertain whether the assessment form appropriate. A58. The auditors judgment as to what constitutes sufficient appropriate audit evidence is influenced by such factors as the quest logical implication of the potential misstatement in the assertion and the likelihood of its having a material effect, one by one or mass with other potential misstatements, on the financial statements. effectivity of managements responses and controls to name the risks. reckon gained during previous audits with compliancy to exchangeable potential misstatements. Results of audit procedures performed, including whether such audit procedures identified specific instances of fraud or error. 23 PSA 330 (Redrafted) root word and reliability of the available information. strong point of the audit evidence. appreciation of the entity and its environment, including the entitys home(a) control. funding (Ref Para. 29) A59.The form and extent of audit documentation is a matter of professional judgment, and is influenced by the nature, size and complexness of the entity and its internal control, availability of information from the entity and the audit methodology and engineering science used in the audit. computer address This PSA is based on world-wide Standard on Auditing 330 (Redrafted), The a ttendees Responses to Assessed Risks, issued by the foreign Auditing and boldness Standards Board. There are no significant differences between this PSA 330 (Redrafted) and ISA 330 (Redrafted). 4 PSA 330 (Redrafted) This PSA 330 (Redrafted), The hearers Responses to Assessed Risks, was nemine contradicente approve for credence on January 29, 2007 by the members of the Auditing and self-assurance Standards Council. benjamin R. Punongbayan, prexy Felicidad A. Abad Antonio P. Acyatan Erwin Vincent G. Alcala Froilan G. Ampil David L. Balangue Ma. Gracia Casals-Diaz Amorsonia B. Escarda Manuel O. Faustino Eliseo A. Fernandez Nestorio C. Roraldo Joaquin P. Tolentino Editha O. Tuason Jaime E. Ysmael 25