Topic results Risk Model

CCH Audit Automation
Audit Risks
This document details the functionality of CCH Audit Automation for recording Identified Audit Risks, also referred to as Significant Business Risks. It provides instructions for users to add, edit, and manage risks, including features for maintaining risks for future audits, assessing their significance, and linking them to assertions. The system includes tools for risk assessment, audit response, and documenting conclusions. Other functionalities encompass risk summarization, printing options, and risk linkage across multiple sources, enhancing the audit process's efficiency and accountability.
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CCH Audit Automation
Risk/Sample Selection
This document outlines the concept of audit risk, defined as the likelihood of undetected material errors during an audit. It introduces a risk model used in Audit Automation that requires total audit risk to remain below acceptable levels across various audit areas. The risks are broken down into inherent risk, control risk, and detection risk, with further subdivisions for detection risk. It emphasizes the importance of understanding these concepts to design effective audit procedures and assess risk at different levels. Additionally, it discusses general and control environments, and the calculation of residual risk, alongside a risk scoring system.
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CCH Audit Automation
Assertion Selection
The document outlines the process for identifying an audit area and assertion combination in a specified section. It instructs users to enter the required information through a dialog interface. Users can select an area from a list, view associated assertions, and confirm their selection by clicking the [OK] button, allowing the system to return the chosen combination. An illustrative image accompanies the text to aid understanding.
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CCH Audit Automation
Control Environment
This document details the assessment of the control environment prior to evaluating area risk in audit planning. It highlights the process for selecting the Control Environment option, mentions the differences in master packs (IPCAS and IFULL), and notes the absence of 'Control environment' questions in the Mercia master packs post-November 2022 release. It also explains how the control environment assessment functions similar to proprietorial controls, using a question format to gauge the strength of the environment and involves a lookup table for point conversion.
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CCH Audit Automation
Risk Model Deactivation
The document outlines the changes in a client pack when a Master Pack is designed without a risk model. Key changes include renaming the "Risk analysis" tool to "Materiality," inactivation of risk analysis options, disabling "Outstanding questions" review, and no checks on audit programs regarding risk model completeness. Additionally, certain planning items are deactivated, and no risk-related pages are included in the planning section. However, the materiality calculation remains accessible for potential use, even if risk assessment is deemed irrelevant.
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CCH Audit Automation
Sample Size Calculation
The document describes a system for calculating sample sizes and risk factors for standard and pool tests in auditing. It outlines how sample sizes are determined based on the highest risk associated with audit assertions, with provisions for maximum sizes and adjustments post-planning. The system ensures all tests link to relevant assertions and prompts recalculations if risk levels change. Additionally, it manages stratification calculations and allows for clearing data during balance forwards. Overall, the process aims to provide precise audit evidence based on variable risk levels.
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CCH Audit Automation
Sample Size - The Calculators
CCH Audit Automation offers three calculators: the Add Lister for checking entries with editable features, the Sample Interval Selector for identifying items exceeding a specified limit for testing, and the Sample Stratification Calculator for determining sample sizes within a stratified population. Users can import data, edit entries, and print results from any calculator. Each calculator provides unique functionalities to assist in audit processes, including a method to analyze risk factors linked to specific items for informed sampling decisions.
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CCH Audit Automation
Running the Risk Model
The document outlines the audit process within a planning menu, highlighting risk assessment routines accessible via the drop-down [Risk analysis] button. It describes the feature that automatically associates mandatory tests with assertions in the Residual Risk program, streamlining the audit efficiency. Additionally, it details how the system prepopulates test selections for all assertions with relevant standard and mandatory tests. This automation aids auditors in creating comprehensive and accurate checklists and ensures adherence to required procedures throughout the audit process.
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CCH Audit Automation
Review Unanswered Risk Questions
The document outlines a planning system that verifies the completion of planning records by checking for answered risk questions at various stages. Users can also manually check for outstanding questions through the Planning section. If any questions remain unanswered, the system provides a dialog listing these areas, allowing users to drill down and respond. The instructions include how to navigate the interface to address these questions effectively.
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CCH Audit Automation
Key Accounting Estimates
This document outlines a new functionality for managing key accounting estimates (KAE) in audit files, allowing for their creation during the planning stage and integration into the audit process. It highlights improvements in handling multiple KAE, the establishment of a dedicated database for KAE, and the development of tailored audit tests that are pulled from master packs. Additionally, it explains how users can access and view KAE in both review mode and standard audit formats, enhancing the overall efficiency of the auditing process.
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