Programme Objective

Accounting estimates is one of the top few recurring findings during Practice Monitoring Programme (PMP) reviews over the years.

This course aims to discuss and address the common deficiencies in auditing accounting estimates with high estimation uncertainty. It will highlight the need to evaluate the methods used by management in estimation and challenge the assumptions used by management.

Upon completion of this course, the participant will be able to:

• Evaluate the methods used by management in developing accounting estimates
• Challenge management assumptions
• Evaluate the reasonableness of assumptions used by management

 

Programme Outline

1.  Audit of impairment testing of goodwill, particularly on:

• The review of the cash flow forecast in estimating the value in use
  • The discount rates
  • The terminal value

2.  Audit of allowance for expected credit loss ECL):

• Evaluation of the method used by management to develop the ECL:
  • provisional matrix approach
  • individual receivables assessment approach

3.  Audit of provision for inventory obsolescence – provision matrix approach

4.  Evaluation of the method used by management in determining fair value of assets

5.  Evaluation of the cost-to-cost method used by management in determining stage of completion of projects for revenue recognition

• Are the correct cost elements included
• Are there cost overruns
• Should there be provision for onerous contract

Training Methodology

Lecture style with case studies

Closing Date for Registration

1 week before programme or until full enrolment.

Intended For

Public accountants and experienced audit professionals.

Programme Facilitator(s)