10 Sep Task 1: 300 words with reference (75 per paragraph)

Task 1: 300 words with reference (75 per paragraph)

AS 1201, 1210, 1215 and 1220 (at least one paragraph for each). These can be found at the PCAOB website and below:

https://pcaobus.org/oversight/standards

AS 1201: Supervision of the Audit Engagement

Introduction

.01       This standard establishes requirements regarding supervision of the audit engagement, including supervising the work of engagement team members.

Objective

.02       The objective of the auditor is to supervise the audit engagement, including supervising the work of engagement team members so that the work is performed as directed and supports the conclusions reached.

Responsibility of the Engagement Partner for Supervision

.03       The engagement partner1 is responsible for the engagement and its performance. Accordingly, the engagement partner is responsible for proper supervision of the work of engagement team members and for compliance with PCAOB standards, including standards regarding using the work of specialists,2 other auditors, 3 internal auditors,4 and others who are involved in testing controls.5 Paragraphs .05-.06 of this standard describe the nature and extent of supervisory activities necessary for proper supervision of engagement team members.6

.04       The engagement partner may seek assistance from appropriate engagement team members in fulfilling his or her responsibilities pursuant to this standard. Engagement team members who assist the engagement partner with supervision of the work of other engagement team members also should comply with the requirements in this standard with respect to the supervisory responsibilities assigned to them. 

Supervision of Engagement Team Members

.05        The engagement partner and, as applicable, other engagement team members performing supervisory activities, should:

a. Inform engagement team members of their responsibilities,7 including:

1. The objectives of the procedures that they are to perform;

2. The nature, timing, and extent of procedures they are to perform; and

3. Matters that could affect the procedures to be performed or the evaluation of the results of those procedures, including relevant aspects of the company, its environment, and its internal control over financial reporting,8 and possible accounting and auditing issues;

b. Direct engagement team members to bring significant accounting and auditing issues arising during the audit to the attention of the engagement partner or other engagement team members performing supervisory activities so they can evaluate those issues and determine that appropriate actions are taken in accordance with PCAOB standards;9

Note: In applying due professional care in accordance with AS 1015, each engagement team member has a responsibility to bring to the attention of appropriate persons, disagreements or concerns the engagement team member might have with respect to accounting and auditing issues that he or she believes are of significance to the financial statements or the auditor’s report regardless of how those disagreements or concerns may have arisen.

c. Review the work of engagement team members to evaluate whether:

1. The work was performed and documented;

2. The objectives of the procedures were achieved; and

3. The results of the work support the conclusions reached.10

.06       To determine the extent of supervision necessary for engagement team members to perform their work as directed and form appropriate conclusions, the engagement partner and other engagement team members performing supervisory activities should take into account:

a. The nature of the company, including its size and complexity;11

b. The nature of the assigned work for each engagement team member, including:

1. The procedures to be performed, and

2. The controls or accounts and disclosures to be tested; 

c. The risks of material misstatement;and

d. The knowledge, skill, and ability of each engagement team member.12

Note: In accordance with the requirements of AS 2301.05, the extent of supervision of engagement team members should be commensurate with the risks of material misstatement.13

Appendix A – Definition

.A1       For purposes of this standard, the term listed below is defined as follows:

.A2       Engagement partner – The member of the engagement team w