Study-Unit Description

Study-Unit Description


CODE ACC3412

 
TITLE Fundamentals of Auditing

 
UM LEVEL 03 - Years 2, 3, 4 in Modular Undergraduate Course

 
MQF LEVEL 6

 
ECTS CREDITS 4

 
DEPARTMENT Accountancy

 
DESCRIPTION This study-unit introduces students to the basic theory and practice of auditing in order to provide the necessary ground-work from which to study auditing in the Master of Accountancy course.

The syllabus is divided into the following key areas:

Audit Framework and Regulation
The Concept of audit and other assurance engagements
Statutory audit
The regulatory environment and corporate governance
Professional ethics and the Malta Code of Ethics for Warrant Holders

Internal Audit
Internal audit and corporate governance
Differences between external and internal audit
Internal audit, risk and internal controls
The internal audit role

Planning and Risk Assessment
Objective and general principles
Understanding the entity and knowledge of the business
Assessing the risks of material misstatement and fraud
Analytical procedures
Planning an audit
Audit documentation

Internal Control
Internal control systems
The use of internal control systems by auditors
Transaction cycles
Tests of control
The evaluation of internal control components
Communication on internal control

Audit evidence
The use of assertions by auditors
Audit procedures
The audit of specific items

Review
Management representations
Audit finalisation and the final review

Reporting
Audit reports
Reports to management
Internal audit reports

Study-unit Aims:

The aim of this study-unit is to enable students to develop the knowledge and understanding of the process of carrying out an assurance engagement, and its practical application in the context of the relevant professional regulatory framework.

Learning Outcomes:

1. Knowledge & Understanding
By the end of the study-unit the student will be able to:

- explain the concept of audit and assurance, as well as the functions of audit, corporate governance, including ethics and professional conduct;
- describe the role, function and scope of internal auditing and external auditing;
- explain the procedures undertaken by an external auditor at the planning, execution and completion stages of an external audit.

2. Skills
By the end of the study-unit the student will be able to:

- apply the knowledge acquired in this study unit to answering questions in the form of scenario/case studies;
- evaluate the ethical considerations that an external auditor may be faced with in practice, and duly recommending safeguards that can be implemented to address such considerations.

Main Text/s and any supplementary readings:

- Porter Brenda, Simon Jon and Hatherly David . Principles of External Auditing, John Wiley and Sons.
- Hayes R, Dassen R, Schilder A, Wallage P - Principles of Auditing: An Introduction to International Standards on Auditing (Prentice Hall).
- International Federation of Accountants. International Standards on Auditing.

 
RULES/CONDITIONS Before TAKING THIS UNIT YOU MUST TAKE EMA1316 AND TAKE ACC1994

 
ADDITIONAL NOTES Pre-Requisite Study-units: EMA1316 and ACC1994

 
STUDY-UNIT TYPE Lecture and Tutorial

 
METHOD OF ASSESSMENT
Assessment Component/s Assessment Due Sept. Asst Session Weighting
Examination (2 Hours) SEM1 Yes 100%

 
LECTURER/S Britney Pisani
Peter J. Baldacchino
Norbert Tabone

 

 
The University makes every effort to ensure that the published Courses Plans, Programmes of Study and Study-Unit information are complete and up-to-date at the time of publication. The University reserves the right to make changes in case errors are detected after publication.
The availability of optional units may be subject to timetabling constraints.
Units not attracting a sufficient number of registrations may be withdrawn without notice.
It should be noted that all the information in the description above applies to study-units available during the academic year 2025/6. It may be subject to change in subsequent years.

https://www.um.edu.mt/course/studyunit