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XBRL AUDIT CASE: CASE SCENARIO

XBRL AUDIT CASE: CASE SCENARIO. Mark & Sons Future Technology Co . (hereafter, MSFT) is a $40 billion public company that provides high-technology products and services.

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XBRL AUDIT CASE: CASE SCENARIO

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  1. XBRL AUDIT CASE:CASE SCENARIO • Mark & Sons Future Technology Co. (hereafter, MSFT) is a $40 billion public company that provides high-technology products and services. • Currently, XBRL does not require independent assurance. However, to enhance users’ confidence and widespread adoption of XBRL, assurance on the XBRL-Related Documents will be needed to reduce users’ uncertainties about the accuracy, completeness, and consistency of the XBRL-tagged information. • The CFO of MSFT, Gerry Thompson, wants the recent XBRL filing of MSFT to be audited to assure its quality. • After completing his master’s degree in accounting at the University of Waterloo, Mike Cullen was hired as an auditor by Waterloo & Co., an accounting firm. • He has worked as an auditor for five years. • Mike has been requested to manage an assurance engagement on the XBRL-Related Documents of MSFT.

  2. XBRL AUDIT CASE:ASSURANCE ENGAGEMENT PROCEDURES • Client/engagement acceptance • Audit Planning • Testing and Collecting Evidence • Internal Control (Task a-1) • Compliance (Task b-1 to Task b-2) • Suitability (Task c-1 to Task c-3) • Accuracy (Task d-1 to Task d-3) • Completeness (Task e-1) • Occurrence (Task f-1) • Consistency (Task g-1 and Task g-2) • Evaluation and Reporting

  3. USEFUL FUNCTIONS FOR XBRL ASSURANCE

  4. A COMPUTER-ASSISTED AUDIT TOOL:XBRL AUDIT ASSISTANT (XAA) Workbench Pane Linkbase View Pane Element View Pane Information View Pane

  5. A COMPUTER-ASSISTED AUDIT TOOL:XBRL AUDIT ASSISTANT (XAA) • Render XBRL instance documents to enable visual review and detailed checking of XBRL instance documents to original financial statements. • Help auditors assess whether the data elements in the instance document reflect the same information as the corresponding financial facts in the official financial statements. • Map the business facts in the official financial statements to the XBRL-tagged data in an instance document. • Help auditors to determine whether XBRL-tagged data are complete and accurate reflection of the business facts in the official financial statements. • Graphically represent XBRL elements to discriminate between those from official XBRL taxonomies and those from companies’ own extension taxonomies. • Help auditors understand taxonomies used to create the instance document and the sources of the XBRL elements. • Graphically represent a systematic structure of the XBRL instance document such as logical ordering of contexts, segments, and elements. • Help auditors understand reporting period, units, the elements used in the instance document, etc.

  6. XBRL AUDIT EXERCISE:COMPLIANCE (Task 1) • Objective:The XBRL-Related Documents are created in accordance with the XBRL specifications and regulatory requirements. • Audit task: • Evaluate whether the XBRL instance document complies with the appropriate XBRL specification and appropriate XBRL taxonomies.

  7. XBRL AUDIT EXERCISE:SUITABILITY (Task 2) • Objective:Appropriate taxonomies are used to tag the underlying business facts in the official filing and the extension taxonomies are necessary to create the instance documents.

  8. XBRL AUDIT EXERCISE:SUITABILITY (Task 2) • Objective:Appropriate taxonomies are used to tag the underlying business facts in the official filing and the extension taxonomies are necessary to create the instance documents. • Audit tasks: • Evaluate the suitability of elements and extension taxonomies. • Assess the appropriateness of the elements used to tag the underlying data. • Determine the proper use of taxonomy extensions.

  9. XBRL AUDIT EXERCISE:ACCURACY (Task 3) • Objective:The XBRL-tagged data in the instance document accurately reflect, in all material respects, all business facts presented in the official financial statements.

  10. XBRL AUDIT EXERCISE:ACCURACY (Task 3) • Objective:The XBRL-tagged data in the instance document accurately reflect, in all material respects, all business facts presented in the official financial statements. • Audit tasks: • Check the accuracy of elements. • Compare the rendered instance document to the corresponding business facts in the official filing.

  11. XBRL AUDIT EXERCISE:COMPLETENESS (Task 4) • Objective:All business facts in the official filings are completely tagged in the instance document. • Audit task: • Assess that all business facts in the corresponding official filing are completely tagged.

  12. XBRL AUDIT EXERCISE:COMPLETENESS (Task 4) • Objective:All business facts in the official filings are completely tagged in the instance document. • Audit tasks: • Assess that all business facts in the corresponding official filing are completely tagged.

  13. XBRL AUDIT EXERCISE:OCCURRENCE (Task 5) • Objective:The instance document only contains valid information. • Audit task: • Assess that information not in the official filing is not in the instance documents.

  14. XBRL AUDIT EXERCISE:OCCURRENCE (Task 5) • Objective:The instance document only contains valid information. • Audit task: • Assess that information not in the official filing is not in the instance documents.

  15. XBRL AUDIT EXERCISE:CONSISTENCY (Task 6) • Objective: The instance The XBRL-related documents are properly managed to ensure consistency. • Audit tasks: • Evaluate whether the same elements are used to tag the same business facts across reporting period and whether the same rules are applied to create context information for the instance documents of different period.

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