ACCA AA study guide
ACCA AA · Work through your exam, one topic at a time.
Audit and Assurance (AA) is one of ACCA's Fundamentals-level exams, sitting within the Applied Skills stage of the ACCA Qualification. ACCA describes its purpose as developing knowledge and understanding of the process of carrying out the assurance engagement and its application in the context of the professional regulatory framework. It is aimed at students who have completed the earlier applied knowledge exams and who intend to work in audit, assurance or a related finance role where an understanding of how an audit is planned, performed and reported is essential. The syllabus is commonly organised around five areas: the audit framework and regulation, planning and risk assessment, internal control, audit evidence, and review and reporting. The ACCA AA study guide has 5 sections and about 1,194 words.
01Audit Framework and Regulation
Audit exists because owners are separated from managers. The agency problem means shareholders cannot verify management's assertions directly, so an independent, competent auditor lends credibility to the financial statements.
264 words, about 1 min02Planning and Risk Assessment
Planning begins with materiality . Performance materiality is set below overall materiality to leave a buffer for undetected misstatements.
236 words, about 1 min03Internal Control
Internal control is designed to provide reasonable assurance about reliable reporting, effective operations, and compliance. Know the five components and, critically, the control activities : segregation of duties, authorisation, physical controls, reconciliations, and IT general controls.
223 words, about 1 min04Audit Evidence
Evidence must be sufficient (quantity) and appropriate (relevance and reliability). Reliability hierarchy: auditor's direct observation external evidence internal evidence oral representations.
220 words, about 1 min05Review and Reporting
Know the structure of the unmodified opinion report: title, addressee, opinion, basis for opinion, going concern section, key audit matters (for listed entities), responsibilities of management and auditor, and signature/date. The opinion is on whether statements are prepared, in all material respects, in accordance with the applicable framework.
251 words, about 1 min