Auditing Contingent Liabilites and Going Concern
Thursday, August 15, 2019 – Thursday, April 30, 2020
Many people envision auditing as performing procedures on various account balances and classes of transactions. They picture auditors confirming, vouching, and generally ticking and tying all the amounts on financial statements. As important as these procedures are, as auditors we understand there is a much bigger picture.
Whether we are reporting under generally accepted accounting principles (GAAP) or a special purpose framework, our objective is much broader. The requirements of the applicable financial reporting framework, whatever it may be, go beyond the numbers represented by its measurement principles. A comprehensive framework will include concepts such as the presumption of a going concern and fair presentation. What disclosures need to be present in addition to those related to the various account balances and classes of transactions in order for the user to not be misled?
This CPE course will tackle some larger, conceptual considerations. These are still based in financial figures and facts, but many times require the auditor to take a step back and look at the larger picture, considering not only the current accounting for the transaction, but the future implications. The accounting and audit requirements of the entity's ability to continue as a going concern, as well as commitments and contingencies-including the auditor's responsibility related to litigation claims assessments-will be presented. The chapter will discuss the procedures and documentation that are required for situations typically required in this audit area. Additionally, an overview of the liquidation basis of accounting will be presented.
Identify basic processes, controls, and audit procedures over the contingent liabilities and identify weaknesses and possible solutions.
Recall the requirements under AU-C section 570 and AU-C section 570, as amended.
Liquidation basis of accounting
Auditing going concern
Auditing going concern as amended by SAS 132