Tianlong Audit Methodology

The Ultimate Guide to Auditing

Chapter 5: Topics for specific circumstances

Standard Accounts

The specific topics provides guidance on designing and performing substantive procedures for the standard accounts stated below. The topic assumes an understanding of TAM and does not summarize or repeat our methodology. 

We read this topic in conjunction with TAM.

We design and perform substantive procedures so that the combination of our procedures (including tests of controls) provides sufficient appropriate audit evidence to reduce audit risk to an acceptably low level and enables us to draw reasonable conclusions on which to base our opinion.

We design and perform substantive procedures at the assertion level to identify material misstatements and, if found, to quantify their effect in the financial statements.

Our substantive procedures consist of one or more of the following:

  • Substantive analytical procedures
  • Tests of details
  • Tests of items to obtain information

Standard Accounts

B - Consolidation conclusions

C - Prospective financial information

D - Cash and short term deposits

E - Marketable securities

F - Segment reporting

G - Inventories

H - Trade receivables

I - Prepayments

J - Investments

K - Intercompany

L - Non-current financial assets

M - Notes payable

N - Trade payable

OE - Leases for lessees

OO - Leases for lessors

P - Provisions

Q - Non-current loans and borrowings and related income statement accounts

R - PPE

S - Commitments, contingencies, derivatives and hedging transactions

T - Equity

U - Intangible assets

V - Income taxes

VA - Indirect taxes

W - Assets recognized for the costs to obtn or fulfil a contract

X - Earnings per share

YA - Revenue

YB - Other operating income

YC - Finance income

YD - Revenue contract liabilities (IFRS 15ASC 606)

YE - Revenue contract assets (IFRS 15ASC 606)

ZA - Cost of sales

ZB - Payroll

ZC - Selling and distribution costs

ZD - Administrative and other operating expenses

ZE - Warranty provision and related income statement accounts

Topics under chapter 5: Topics for Specific Circumstances

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