For high-quality audits that comply with AICPA Risk Assessment Standards, equip yourself with Knowledge-Based Audit titles (KBA). Each title based on the KBA framework includes the latest audit requirements for a specific type of company or organization. Namely, we are excited to introduce the new updates and enhancements for Financial Institutions.
Financial Institutions – updated & enhanced
First, 2018 Knowledge-Based Audit of Financial Institutions became available for Knowledge Coach in November 2018. Therefore, it is time to get up to speed on the changes. Forthwith, get ready to increase your realizations and improve your client service!
Based on latest literature, standards, and guidance
Second, the updates follow the latest literature, standards, and guidance:
- FASB Accounting Standards Codification™ as of September 30, 2018, through Accounting Standards Update No. 2018-15
- AICPA Statement on Auditing Standards (SAS) No. 133, Auditor Involvement with Exempt Offering Documents
- AU-C 930, Interim Financial Information
- AU-C 940, An Audit of Internal Control Over Financial Reporting That Is Integrated With an Audit of Financial Statements
Knowledge-based Audit titles – what’s new for Financial Institutions?
Third, the following enhancements are also included:
- Links to TeamMate Analytics throughout the AUD-800 series programs assist the auditor with analytical procedures beneficial to the audit process
- Enhanced instructions and procedures throughout the toolset improve workflow
- Reorganization of multiple areas within the Audit Programs increase efficiency and improve workflow
- New columns in the workpapers documenting internal controls (KBA-400s) improve workflow and address questions customers have raised in the past
- Activity-level control forms, have updated subprocesses and activity-level control objectives throughout all the KBA-403 series workpapers
- Users can document a separate benchmark and rule of thumb percentage not used in the KBA methodology, thanks to changes to the benchmark/rule of thumb percentage table in KBA-301 Worksheet for Determination of Materiality, Performance Materiality, and Thresholds for Trivial Amounts
- New comments table in AUD-100 Engagement-Level Tailoring Questions document any information you want to capture related to tailoring
- Incorporated are audit recommendations from AICPA’s Audit and Accounting Guide: Revenue Recognition. This includes several new revenue related steps in AUD-803 Audit Program: Loans Receivable, Interest Income, and Accrued Interest Receivable.
- A new “example planned response” to Management Override of Controls in KBA-502 flows to the AUD-800 series. Modify this in the risk pane for the Financial Statement Level Risk of Management Override of Controls. Additionally, when modified, the user bases the modification on the specific audit.
- A new RES-028 Controls Related to FASB ASC 606, Revenue from Contracts with Customer – Five Step Model assists users whose clients have adopted the new Revenue Recognition Standards.
- Now available:
- AUD-915 Audit or Interim Review Program: Auditor Involvement with Exempt Offering Documents based on AICPA Statement on Auditing Standards (SAS) No. 133, Auditor Involvement with Exempt Offering Documents
- AUD-910 Audit Program: Specific Element, Account, or Item of a Financial Statement in Accordance with AU-C 805, included for auditors performing engagements under AU-C 805
Tips to improve realizations & client service
In closing, regarding increasing your realizations and improving your client service, it is critical to find ways to maximize efficiencies. In addition, doing so will ensure a healthy bottom line and, at the same time, improved client service. Consider these tips:
- First, when rolling-forward prior year engagements, get the latest content updates. Also, keep your responses, where it makes sense. Then, simply review for changes.
- CCH ProSystem fx Knowledge Coach allows updating to the latest content at any time, while keeping your answers and customizations. Take advantage of the saved time and start your planning!
- Second, give yourself a head start by reducing your client’s PBC list by approximately 25% through technology.
- CCH Audit Accelerator requests all the data you need from your client’s general ledger, accounts payable and accounts receivable sub-ledger. It then transforms that data into the most commonly used workpapers, including access to the detailed transactions. Then, with TeamMate Analytics, you run analytics to see the anomalies or risky transactions more quickly for planning a higher quality audit. What you gain is more answers at your fingertips and, ultimately, a more informed view of your client at the beginning of each engagement.
- Third, tailor your audit programs in direct response to the client’s risk. This helps avoid over and under auditing. Moreover, you will get the‘best bang for your buck’ with your audit procedures.
- By design, Knowledge Coach easily ties risks to audit procedures. Thus, the result is a higher quality and more efficient audit … and a happier client.
So, are you interested in increased realizations and improved client service? Then check out the Integrated Audit Approach today.