Legal encyclopedia. The letter P

RISK OF CONTROL FACILITIES

- the auditor's confidence that the accounting reporting systems and internal control systems existing in the enterprise will not promptly identify, correct and suppress violations that are significant.

The reliability of controls and the risk of controls are complementary categories:

1) high reliability corresponds to low risk;

2) average reliability corresponds to the average risk;

3) low reliability corresponds to a high risk.

In the course of conducting audits, the auditor should assess the internal control system of the economic entity, which occurs in three stages:

1) familiarity with the internal control system;

2) assessment of the reliability of the internal

Control;

3) confirmation of the reliability of the assessment of the reliability of the internal control system.

Special audit procedures that the auditor applies to assess the risk of controls are called testing controls, the purpose of which is to convince the auditor that:

1) how the accounting and internal control systems provided by the enterprise operate and how these systems prevent the appearance of distortions in the financial statements and whether they are able to identify them;

2) whether control facilities operate with the same efficiency throughout the reporting period. Testing controls includes:

1) checking documents in which financial and business transactions are reflected;

2) monitoring the execution of transactions to obtain audit evidence of the functioning of controls;

3) use the results of other audit procedures to obtain activity data from third-party control.

In considering the results of the

Testing, the auditor should take into account that some controls can be effective in general, but not be effective at any given time, which is due to the following factors:

1) short-term replacement of an accountant responsible for the implementation of this means of control;

2) features of the work of the accounting entity of the economic entity, reflecting seasonal periods of work of increased intensity;

3) the appearance of errors.

In carrying out its activities, the auditor should take these factors into account, consider the negative results of testing controls, based on which to plan their audits.

The auditor tests all controls, except when he assesses RSK as high. When evaluating the RSK, the auditor has the right to use the audit data of previous years, but on condition that he is satisfied that the estimates of the magnitude of such a risk made in this test are valid for a given year.

The results of the assessment of the RCK auditor reflects

In the general audit plan, and the existing refinement estimates - in the working documentation for the audit.