Audit and Assurance
The Audit and Assurance domain tests risk-based audit under the Cambodian Standards on Auditing (CSAs), which KICPAA adopts from ISAs, together with the Law on Accounting and Auditing (2016). You must plan an audit, assess risks, gather sufficient appropriate evidence, and report appropriately, while complying with quality management and ethical requirements.
Core rules
- Acceptance and continuance: confirm independence, competence and agreed terms (ISA 210).
- Risk assessment (ISA 315): understand the entity and its internal control, then identify risks of material misstatement at financial statement and assertion level.
- Materiality (ISA 320): set overall materiality, performance materiality and a clearly trivial threshold; revise if needed.
- Evidence (ISA 500): sufficient (quantity) and appropriate (relevance and reliability). Inquiry alone is rarely enough.
- Reporting: ISA 700 opinion; ISA 701 key audit matters for listed entities; ISA 570 going concern; ISA 705 modifications; ISA 706 emphasis of matter.
- Statutory audit: PIEs and enterprises meeting the MEF size criteria must be audited; auditors and firms must be registered with KICPAA.
Worked example
Profit before tax is $800,000, revenue $12m, total assets $9m. Using 5% of PBT gives $40,000; 0.5% of revenue gives $60,000; 1% of assets gives $90,000. A profit-oriented entity would normally select $40,000 and set performance materiality at 75%, or $30,000. The clearly trivial threshold might be 5% of materiality, or $2,000.
Traps
Using the same materiality for every account; failing to revise materiality; treating management inquiry as sufficient evidence; issuing an unmodified opinion where a material uncertainty exists without the required going-concern paragraph; and poor documentation of judgments.