Auditing and Attestation ProjectThe CPA exam is complex and can be difficult to pass without...

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Auditing and Attestation ProjectThe CPA exam is complex and can be difficult to pass without adequate study time. A plan to study adequately is essential to pass the exam. To study, you must fully...

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Auditing and Attestation Project

The CPA exam is complex and can be difficult to pass without adequate study time. A plan to study adequately is essential to pass the exam. To study, you must fully understand what is on the exam.

Tasks:

Pick one of the main four topics covered in the AUD section of the CPA exam: understanding ethics, professional responsibilities, and general principles; assessing risk and developing a planned response; performing further procedures and obtaining evidence; and forming conclusions and reporting.

Identify the different components that make up the main topic you choose.

Analyze the importance of understanding these components.

Evaluate how you would study for these components.

Compare how you would study for the FAR and AUD sections of the CPA exam.

To support your work, use your course and textbook readings and also use theSouth University Online Library. As in all assignments, cite your sources in your work and provide references for the citations in APA format.

Submission Details:

Present a 4- to 5-page paper in a Microsoft Word document formatted in APA style. Cite any sources using APA guidelines.

Answered 2 days After Aug 24, 2023

Prince · Accepted Answer

Assessing Risk and Developing a Planned Response
Student Name
24th Aug 2023
Introduction
The Uniform CPA Examination tests various accounting topics across four main sections - Financial Accounting and Reporting (FAR), Auditing and Attestation (AUD), Regulation (REG), and Business Environment Concepts (BEC). Passing these sections is required to obtain CPA licensure. This report focuses on the AUD section and specifically the topic of assessing risk and developing a planned audit response. It identifies the key components of this topic, analyzes why they are important for auditors to understand, evaluates recommended study techniques, and compares preparation strategies for AUD versus FAR. 
Assessing Risk and Developing a Planned Response
The AUD section of the CPA exam covers auditing and attestation. One of the main topics is assessing risk and developing a planned response. This topic includes understanding different types of risk, how to assess risk, and how to develop appropriate responses (AICPA, 2019). 
1. Components of Assessing Risk
There are three main types of risk that auditors need to assess:
· Inherent risk - This is the baseline level of risk that exists in any accounting system or business process before considering internal controls. It is the susceptibility of an assertion to misstatement without considering controls (PCAOB, 2010). 
· Control risk - This is the risk that a material misstatement could occur and not be prevented or detected by internal controls. Auditors assess the effectiveness of internal controls to determine the level of control risk (AICPA, 2006).
· Detection risk - This is the risk that the auditor will not detect a material misstatement. Auditors use audit procedures and evidence gathering to reduce detection risk (PCAOB, 2010).
2. Importance of Understanding These Components
It is essential that auditors understand the components of assessing risk and responding appropriately. This allows auditors to:
· Properly evaluate the scope of risk - Auditors can identify high risk areas and devote focus and resources to these areas (Robertson, 2015).

Auditing and Attestation ProjectThe CPA exam is complex and can be difficult to pass without adequate study time. A plan to study adequately is essential to pass the exam. To study, you must fully...