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INTOSAI STANDARDS August 2012 Experientia Mutua Omnibus Proudest "Mutual experience benefits all" Slide 2 INTOSAI The International Organisation of Supreme Audit Institutions (INTOSAI) operates as an umbrella organisation for the external government audit community. At present INTOSAI has 190 Full Members and 4 Associated Members. On 22 Dec 2011 the 66 th United Nations General Assembly adopted the resolution promoting the efficiency, accountability, effectiveness and transparency of public administration by strengthening supreme audit institutions. Slide 3 INTOSAI Congress Governing Board, 18 members General Secretariat in Vienna, Austria Regional Groups Committees Working Groups Slide 4 REGIONAL GROUPS Regional Professional and technical cooperation AFROSAI ARABOSAI 22 Arabic speaking ASOSAI CAROSAI Caribbean EUROSAI OLACEFS Organization of Latin American Caribbean PASAI Pacific Association Slide 5 Slide 6 INTOSAI COMMITTEES Professional Standards Committee Standards on Financial Audit, Compliance Audit, Performance Audit, Internal Controls, Quality control Capacity Building Committee Knowledge Sharing Committee Standards on IT Audit, Environmental Auditing, PPP, Privatisation, Economic regulation, Public debt etc Finance & Administration Committee Slide 7 International Standards of Supreme Audit Institutions ISSAIs INTOSAI Slide 8 ICAI Auditing Standards Standards on Quality Control (SQCs) SQC 1, Quality Control for Firms that Perform Audit and Reviews of Historical Financial Information, and other Assurance and Related Services Engagements Audits and Reviews of Historical Financial Information 100-199 Introductory Matters 200-299 General Principles and Responsibilities SA 200 Overall Objectives of the Independent Auditor and the Conduct of an Audit in Accordance with Standards on Auditing SA 210 Agreeing the Terms of Audit Engagements Slide 9 ICAI Auditing Standards 200-299 General Principles and Responsibilities continued SA 220 Quality Control for an Audit of Financial Statements SA 230 Audit Documentation SA 240 The Auditors Responsibilities Relating to Fraud in an Audit of Financial Statements SA 250 Consideration of Laws and Regulations in an Audit of Financial Statements SA 260 Communication with Those Charged with Governance SA 265 Communicating Deficiencies in Internal Control to Those Charged With Governance and Management SA 299 Responsibility of Joint Auditors Slide 10 ICAI Standards 300-499 Risk Assessment and Response to Assessed Risks SA 300 Planning an Audit of Financial Statements SA 315 Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment SA 320 Materiality in Planning and Performing an Audit SA 330 The Auditors Responses to Assessed Risks SA 402 Audit Considerations Relating to an Entity Using a Service Organisation SA 450 Evaluation of Misstatements Identified During the Audit Slide 11 500-599 Audit Evidence SA 500 Audit Evidence SA 501 Audit EvidenceSpecific Considerations for Selected Items SA 505 External Confirmations SA 510 Initial Audit Engagements Opening Balances SA 520 Analytical Procedures SA 530 Audit Sampling SA 540 Auditing Accounting Estimates, Including Fair Value Accounting Estimates, and Related Disclosures SA 550 Related Parties SA 560 Subsequent Events SA 570 Going Concern SA 580 Written Representations Slide 12 600-699 Using Work of Others SA 600 (AAS 10), Using the Work of Another Auditor SA 610 Using The Work of Internal Auditors SA 620 Using the Work of an Auditors Expert 700-799 Audit Conclusions and Reporting SA 700 Forming an Opinion and Reporting on Financial Statements SA 705 Modifications to the Opinion in the Independent Auditors Report" SA 706 Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditors Report" SA 710 Comparative InformationCorresponding Figures and Comparative Financial Statements SA 720 The Auditors Responsibility in Relation to Other Information in Documents Containing Audited Financial Statements Slide 13 800-899 Specialized Areas SA 800 Audits of Financial Statements Prepared in Accordance with Special Purpose Frameworks SA 805 Special ConsiderationsAudits of Single Financial Statements and Specific Elements, Accounts or Items of a Financial Statement SA 810 Engagements to Report on Summary Financial Statements 2000-2699 Standards on Review Engagements (SREs) SRE 2400 Engagements to Review Financial Statements SRE 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity 3000- 3669 Assurance Engagements Other Than Audits or Reviews of Historical Financial Information 4000-4699 Standards on Related Services (SRSs) Slide 14 Auditing Standards INDIAN AUDIT AND ACCOUNTS DEPARTMENT AUDITING STANDARDS 1 st Edition 1994 2 nd Edition 2002 Comptroller and Auditor General of India Slide 15 Why auditing standards? Assurance about the quality of audit done to the users of the audit reports Use them as bench mark or measure while doing audit, common frame of reference Standardisation of process and products, uniformity between all the auditors- audits, so that comparison is fair Increases credibility, increase of level of perception for users Slide 16 International Standards of Supreme Audit Institutions ISSAIs INTOSAI Slide 17 The standards developed by INTOSAI for guiding the Government Audit profession are termed as International Standards of Supreme Audit Institutions (ISSAI). These standards are hierarchically divided into four groups or levels. Level-1: Founding Principles Level-2: Prerequisites for functioning of Supreme Audit Institutions Level-3: Fundamental Auditing Principles Level-4: Auditing Guidelines-Implementation guidelines, specific guidelines Slide 18 Level 1: Founding principles ISSAI 1 : LIMA Declaration (1977) Level 2: Prerequisites for the Functioning of Supreme Audit Institutions ISSAI 10 : Mexico Declaration on SAI Independence (1987) ISSAI 11 : INTOSAI Guidelines & Good Practices Related to SAI Independence ISSAI 20 : Principles of Transparency & Accountability ISSAI 21 : Principles of Transparency - Good Practices ISSAI 30 : Code of Ethics ISSAI 40 : Quality Control for SAIs Slide 19 Level 3: Fundamental Auditing Principles ISSAI 100: INTOSAI Auditing Standards - Basic Principles ISSAI 200 : INTOSAI Auditing Standards - General Standards ISSAI 300: INTOSAI Auditing Standards - Field Standards ISSAI 400 :INTOSAI Auditing Standards - Reporting Standards Slide 20 Under 4 th level there are three sets of guidelines Implementation Guidelines Specific Guidelines Guidance on Good Governance Slide 21 Level 4: Implementation Guidelines ISSAI 1000 to 2999 : Financial Auditing Guidelines about 50 standards in this series for example standard 1500 audit evidence; 1530 audit sampling ISSAI 3000 to 3999: Performance Auditing Guidelines 2 standards in this series-3000,3100 ISSAI 4000 to 4999 : Compliance Auditing Guidelines 3 standards in this series-3000,3100 Slide 22 Level 4: Auditing Guidelines - Specific Guidelines on ISSAI 5000 to 5099: Audit of International Institutions ISSAI 5100 to 5199: Environmental Audit ISSAI 5200 to 5299: Audit of Privatisation ISSAI 5300 to 5399: IT-Audit ISSAI 5400 to 5499 :Audit of Public Debt ISSAI 5500 to 5599 : Audit of Disaster related Aid ISSAI 5600 to 5699 :Peer Review Guidelines Slide 23 Slide 24 Slide 25 Slide 26 Level 3: Fundamental Auditing Principles ISSAI 100: INTOSAI Auditing Standards - Basic Principles ISSAI 200 : INTOSAI Auditing Standards - General Standards ISSAI 300: INTOSAI Auditing Standards - Field Standards ISSAI 400 :INTOSAI Auditing Standards - Reporting Standards In rest of the places the word guidelines is used (ISSSAI 10000 to 9299) Slide 27 Fundamental Auditing Principles - revised ISSAI 100: Fundamental Principles of Public Sector Auditing ISSAI 200: Fundamental Principles of Financial Auditing ISSAI 300: Fundamental Principles of Performance Auditing ISSAI 100: Fundamental Principles of Compliance Auditing Slide 28 standards for any audit Auditors-Skills, ethics, independence, objectivity, professional behaviour Exercising professional care, professional scepticism, quality standards during audit Audit involves three parties auditor, auditee and user- terms of engagement Subject matter to be audited, understanding the entity, audit risk, planning the audit Slide 29 standards for any audit..continued Audit objectives Audit criteria Audit procedures ( standard does not elaborate the procedures ) review of internal controls- substantive testing (analytical review) Slide 30 standards for any audit..continued Materiality, significant deviations Sufficient appropriate audit evidence Audit findings, conclusions Documentation of entire audit process & evidence Reporting -reasonable assurance/ short form Reporting -exception reporting/ long form Discussion in Legislative committees Follow-up Slide 31 Auditors-Skills, ethics, independence, objectivity, professional behaviour Exercising professional care, professional scepticism, quality standards during audit Audit involves three parties auditor, auditee and user- terms of engagement Subject matter for audit, understanding the entity, audit risk, planning the audit Audit objectives- Audit criteria Audit procedures ( review of controls, substantive testing ) Materiality, significant deviations Sufficient appropriate audit evidence Audit findings, conclusions Documentation of entire audit process and evidence Reporting (reasonable assurance-short form report)(exception reporting-long form report)- Discussions in Legislative Committee- Follow up