College of Business and Economics
Department of Accounting and Finance
Course Information
Course AcFn3162
Number
Course Auditing Principles and Practices II
Title
Degree BA Degree in Accounting and Finance
Program
Module No M16; AcFn-M3161
and Code
ETCTS 5
Credits
Contact 3
Hours (per
week)
Course At the end of the course the student is expected to:
Objectives & Apply his knowledge of auditing theory, auditing standards, techniques and
Competences procedures to practical situations commonly encountered relative to an
to be opinion audit.
Acquired Be acquainted the principles that underlie audit of Balance Sheet and Income
Statement accounts
Enumerate and understand the audit objectives for the audit of major accounts;
Develop audit procures for the audit of major accounts; and
Comprehend the significance of professional competence, independence, and
mental integrity in the practice of accountancy.
Be committed to bringing about a prevalence of good reporting practice and
contribute to the pursuit of social justice and fairness.
Course The course builds on the knowledge gained in Auditing I. It covers an in depth
Description practical aspects of topics introduced in Auditing I and brings in new concepts as well.
The course introduces audit sampling in general and goes on to application of
statistical tools in tests of controls and balances. The technical application of auditing
procedures for balance sheet and income statement accounts in an audit undertaking
are the foremost subject matters of the course. Audit of systems that include EDP
application along with tools and techniques used in evaluation and understanding of
internal control in such environments will be introduced.
Course Contents
1. Sampling in Auditing
1.1 Rationale for and methods of Audit Sampling
1.2 Audit sampling for tests of controls
1.3 Audit sampling for substantive tests
2. Audit of Cash and Marketable Securities
2.1. Internal control over cash transactions, receipts and disbursements
2.2. Audit program for cash
2.3. Internal control over Marketable securities
2.4. Audit program for marketable securities
3. Audit of Receivables and Sales
3.1. Internal control over Sales transactions, and Accounts Receivable
3.2. Internal control over Notes Receivable
3.3. Audit program for Receivables and Sales
4. Inventories and Cost of goods sold
4.1. Internal control over Inventories and Cost of goods sold
4.2. Audit program for Inventories and Cost of goods sold
5. Audit of Fixed Assets
5.1. Internal control over plant and equipment
5.2. The plant and equipment budget
5.3. Audit program for property plant and equipment
6. Audit of current liabilities
6.1. Internal control over Accounts payable
6.2. Audit program for accounts payable and other liabilities
7. Audit of Debt and Equity capital
7.1. Internal control over interest bearing debt
7.2. Audit programs for interest bearing debt
7.3. Internal control over equity capital and dividends
7.4. Audit program for capital stock
7.5. Audit of sole proprietorships, and partnerships
7.6. Disclosure of contingencies
Text Book: Principles of Auditing and Practice 2nd ed Thomas and Henke
Auditing, Kiger and Scheiner
Principles of auditing, 10th ed. Meigs and others
Basic auditing principles Arthur and Holmes
Commercial code of Ethiopia
Lessane auditor, quarterly publication of OAG
Various proclamations and financial regulations and journals
Journal of accountancy, AICPA
The accounting review, AAA
