Advanced Auditing III (Audit Evidence & Reporting)

Course Code: BBA-AUD 490
Credit Hours: 3
Semester Offered: Year 4 – Semester 7

Course Description

This course focuses on the gathering, evaluation, and documentation of audit evidence and the preparation of audit reports in accordance with International Standards on Auditing (ISA). It builds on previous auditing courses, emphasizing the auditor’s responsibility to collect sufficient and appropriate evidence, evaluate findings, and communicate results effectively to stakeholders. Students will gain practical skills in audit sampling, analytical procedures, documentation, and reporting, including opinions on financial statements, emphasis-of-matter, and key audit matters.

Course Objectives

By the end of the course, students should be able to:

1. Understand the types and sources of audit evidence.

2. Apply techniques to gather and evaluate audit evidence effectively.

3. Document audit findings in compliance with professional standards.

4. Prepare audit reports, including standard and modified opinions.

5. Communicate audit results to management, boards, and regulatory authorities.

6. Apply professional skepticism and ethical principles throughout the audit process.

Learning Outcomes

Upon completion of this course, students will be able to:

• Design audit procedures to obtain sufficient, reliable evidence.

• Assess the quality and relevance of audit evidence.

• Prepare clear and compliant audit documentation and working papers.

• Issue audit opinions consistent with ISA 700–799 standards.

• Communicate audit findings effectively to internal and external stakeholders.

Key Topics

1. Introduction to Audit Evidence

   • Nature, relevance, and reliability of evidence

   • Sources of evidence: internal, external, physical, electronic

2. Techniques for Gathering Evidence

   • Inspection, observation, inquiry, confirmation, recalculation, reperformance

   • Analytical procedures and substantive testing

   • Sampling techniques and audit sampling risks

3. Documentation of Audit Evidence

   • Working papers and audit files

   • Documentation standards and retention requirements

   • Evidence evaluation and sufficiency assessment

4. Audit Reporting Standards

   • ISA 700–799: Audit report structure and content

   • Types of audit opinions (unmodified, qualified, adverse, disclaimer)

   • Emphasis-of-matter and key audit matters disclosures

5. Special Reporting Considerations

   • Reporting on fraud, non-compliance, and going concern issues

   • Communicating findings to management and stakeholders

   • Ethical and professional responsibilities in reporting

6. Practical Applications

   • Case studies of audit reports and opinion modifications

   • Real-world scenarios for evaluating audit evidence

   • Integration of technology in audit evidence collection (CAATs)

Teaching Methods

• Lectures and interactive discussions

• Case studies of financial statement audits

• Practical exercises in evidence collection and documentation

• Group projects on audit report preparation

Assessment Methods

• Assignments & Case Studies (20%)

• Midterm Examination (20%)

• Group Project (Audit Evidence & Reporting) (10%)

• Final Examination (50%)

???? Recommended Textbooks & References

1. Arens, A. A., Elder, R. J., & Beasley, M. S. – Auditing and Assurance Services: An Integrated Approach

2. Hayes, R., Dassen, R., Schilder, A., & Wallage, P. – Principles of Auditing: An International Perspective

3. International Standards on Auditing (ISA 200–799) – IFAC/IAASB

4. Knechel, W., van Staden, C., & Sun, L. – Audit Evidence and Reporting