Foothill CollegeApproved Course Outlines

Business and Social Sciences Division
ACTG 58AUDITINGSummer 2011
5 hours lecture.5 Units

Total Quarter Learning Hours: 60 (Total of All Lecture, Lecture/Lab, and Lab hours X 12)
 
 Lecture Hours: 5 Lab Hours: Lecture/Lab:
 Note: If Lab hours are specified, see item 10. Lab Content below.

Repeatability -
Statement: Not Repeatable.

Status -
 Course Status: ActiveGrading: Letter Grade with P/NP option
 Degree Status: ApplicableCredit Status: Credit
 Degree or Certificate Requirement: AA Degree,   Certificate of Achievement
 GE Status: Non-GE

Articulation Office Information -
 Transferability: CSUValidation: 12/13/10

1. Description -
Study of the contemporary auditing environment, auditing profession, and the principle, and practices of financial statement audit. Topics include auditing, attestation and assurance services, Generally Accepted Auditing Standards (GAAS), attestation standards, professional ethics, Sarbanes-Oxley Act 2002 regulatory requirements, internal controls and audit risk, audit planning, procedures, evidence, documentation and report writing.
Prerequisite: ACTG 51A.
Co-requisite: None
Advisory: Eligibility for MATH 220 and ESLL 26.

2. Course Objectives -
Student will be able to:
  1. Explain auditing
  2. Understand the role of CPA firms, the Public Company Accounting Oversight Board, and Securities and Exchange Commission
  3. Explain professional ethics
  4. Explain the legal liabilities and responsibilities of auditors
  5. Explain audit planning and analytical procedures
  6. Define the concept of materiality and risk
  7. Define audit evidence and prepare audit documentation
  8. Prepare audit reports and explain types of auditor's reports under different circumstances
3. Special Facilities and/or Equipment -
Access to a computer lab and Excel software. When taught as an online distance learning section, students and faculty need ongoing and continuous Internet and email access.

4. Course Content (Body of knowledge) -
  1. Explain auditing
    1. Nature of auditing
    2. Distinction between auditing and accounting
    3. Attestation engagements
    4. Assurance services
    5. Types of auditors
  2. Understand the role of CPA firms, the Public Company Accounting Oversight Board, and Securities and Exchange Commission as it relates to auditing
    1. Certified Public Accounting firms
    2. Activities of CPA firms
    3. Sarbanes-Oxley Act and Public Company Oversight Board
    4. Securities and Exchange Commission
    5. American Institute of Certified Public Accountants
    6. U.S. and International standards on Auditing
    7. Generally Accepted Auditing Standards
    8. Statements of Auditing Standards
  3. Explain professional ethics
    1. Define ethics
    2. Ethical dilemmas
    3. Importance of ethical conduct
    4. Code of professional conduct
    5. Independence rule of conduct and interpretation
    6. Enforcement
  4. Explain the legal liabilities and responsibilities of auditors
    1. Changed environment
    2. Distinguishing business failure, audit failure, and audit risk
    3. Legal concepts affecting liabilities
    4. Liability to clients
    5. Civil liabilities under federal courts
    6. Criminal liabilities
  5. Explain audit planning and analytical procedures
    1. Planning
    2. Client acceptance decisions and initial planning
    3. Understanding the client's business and industry
    4. Assess client business risk
    5. Five types of analytical procedures
  6. Define the concept of materiality and risk
    1. Differences among frauds, errors, and illegal acts
    2. Auditors responsibilities with respect to illegal acts
    3. Conditions that can lead to fraud
    4. Conceptual audit risk models
    5. Materiality and its relationships to audit risk models
    6. Content and purpose of audit plan
  7. Define audit evidence and prepare audit documentation
    1. Basic sources of audit evidence
    2. Assertion containment in financial statements
    3. Directional testing and its importance in achieving audit efficiency
    4. Nature and purpose of audit programs
    5. Purposes and contents of good audit documentations
  8. Prepare audit reports and explain types of auditor's reports under different circumstances
    1. Levels of assurance provided by auditors
    2. Reporting on internal control over financial reporting
    3. Expression of opinion on the financial statements
    4. Audit reports on comparative statements
    5. Special reports
5. Repeatability - Moved to header area.
 
6. Methods of Evaluation -
Examinations, quizzes, computerized assignments, written reports, group activities, and class presentations.
7. Representative Text(s) -
Arens, A. Alvin; Elder, J. Randal; Beasley, S. Mark, Auditing and Assurance Services, an Integrated Approach, 13th edition, Prentice Hall, New Jersey, 2010.

8. Disciplines -
Accounting
 
9. Method of Instruction -
Lecture, in class or electronic discussions, field visits, group work, case studies.
 
10. Lab Content -
Not applicable.
 
11. Honors Description - No longer used. Integrated into main description section.
 
12. Types and/or Examples of Required Reading, Writing and Outside of Class Assignments -
A. Reading of corporate annual reports
  • The CPA Journal at http://www.cpajournal.com/acc.htm
  • Reading of latest development in Generally Accepted Auditing Standards
  • Reading of internet articles and incorporating the information into the written project
  • Auditing Journal of Theory and Practice, Current editions.
  • Reading of Wall Street Journal, Business Week, and Fortune
  • 13. Need/Justification -
    This course is a restricted support course for the AA degree in Accounting.


    Course status: Active
    Last updated: 2013-07-29 15:41:31


    Foothill CollegeApproved Course Outlines