Course AIM 6334-5U1 (10070) Auditing

Professor Liliana Hickman-Riggs, CPA CITP CMA CIA CFF CFE FCPA DABFA MS
Term Summer 2009
Meets Thursday 6:00-10:00PM pm in SOM 1.217

Professor’s Contact Information

Office Phone 214 378-5400 (# to call for a timely answer)
Office Phone-UT-D 972 883-5903
Office Location SOM 4.228
Email Address liliana.hickman-riggs@utdallas.edu and liliana@accounting.net
Tuesday 4:30 - 5:45 PM
Office Hours Thursday 4:30 – 5:45 PM or by appointment
Other Information TA’s e-mail: chris.holsonback@student.utdallas.edu
General Course Information
Course AIM 6334 Auditing is a challenging and difficult course that can vastly add to your
Description knowledge. To be successful in this course, you must devote adequate preparation time. The
course text chapter reading assignments and homework problems are indicated on the schedule.

If you are having difficulty with the topics presented, please see me and or the TA at the
earliest opportunity. Chapter reading assignments should be completed in a timely manner.
The assignment schedule may be modified during the semester if necessary.

All efforts will be made to cover each chapter in a detailed manner. Because of the quantity of
the material to be covered, an in depth study of each chapter cannot be realistically achieved.
It is therefore the responsibility of each student to study any portions not covered in class.

Learning Basic concepts, standards, procedures, and practices of auditing are presented.
Outcomes Topics include generally accepted auditing standards, the changing role of the independent
auditor in society, professional conduct and ethics, the auditor’s reporting responsibilities, risk
assessment, internal control, fraud, evidential matter, and auditing in the global economy. The
course will serve as a base for the ever interesting opportunities in Forensic Accounting and
Fraud Examination areas.

To use critical thinking

To achieve a thorough understanding of the basic concepts, standards, procedures
and practices of the public accounting profession’s reporting obligations and responsibilities.
To understand and appreciate how the basic concepts, standards, procedures and
practices of the public accounting profession affect the various stakeholders who rely or may
rely on general purpose financial statements and/or other financial or non-financial
information that has been reported on by professional accountants.
To understand the meaning of "professional standards” and their history, evolution and
establishment as they relate to professional accountants’ reporting responsibilities.
To understand and appreciate the difference between professional standards that relate to

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 professional accountants’ reporting responsibilities and established criteria used by preparers,
To understand and appreciate the dynamic and changing public accounting and auditing
profession.

To understand and appreciate the ethical legal and business issues of the public accounting
and auditing profession
Discuss the potential conflicting objectives among users, preparers and auditors of general
purpose financial statements.
Discuss the current ethical issues facing the accounting profession.
Discuss the current legal and regulatory environment facing the profession and its clients and
the current credibility crisis facing the profession.
Discuss the changing business model and its effect on management, investors, creditors and
the public accounting profession.

To recognize that auditing and accounting are not limited by national boundaries and that
differences do exist
The current status of international accounting standards.
The current status of international auditing standards.
To enjoy the course

Required Auditing & Assurance Services, Messier, 6th Edition, McGraw-Hill ISBN # 0-07-352690-8
Texts & www.mhhe.com/messier6e
Materials
Resources The textbook for this course provides a wealth of material. However, the universe of auditing
information is much greater than what you will find in the text. Much of it is available in the Online
Learning Center (http://highered.mcgraw-hill.com/sites/0073526908/student_view0/index.html). The
Online Learning Center offers chapter by chapter quizzes, flashcards, and other valuable to your
understanding of auditing.

On WebCT I have posted power point presentations for each chapter available to you at your
discretion. I do not use PP during the class but if you find them useful they are there for you.
I have also posted solutions for the exercises for each chapter so that you can check the
correctness of your work.

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Assignments & Academic Calendar
Chapters and timelines are subject to change at the discretion of the Professor. Stay informed! Be prepared!

Month Day Subject Matter Suggested Homework

(not graded)
May 28 Introduction of the course Every MC, exercise in each chapter
covered in this course is useful. Do as
Chapter 1: An Introduction to Auditing & Assurance many as you can. The solutions are
posted on WebCT.

June 4 Chapter 2: The Financial Statement Auditing Environment Every MC, exercise in each chapter
covered in this course is useful. Do as
Chapter 3: Risk Assessment and Materiality many as you can. The solutions are
Chapter 5: Planning and Types of Audit Test posted on WebCT.

11 Chapter 6: Internal Control in a Financial Statement Audit Every MC, exercise in each chapter
covered in this course is useful. Do as
Chapter 7: Auditing Internal Control over Financial Reporting many as you can.

18 Online Exam 1 Ch. 1-3 & 5-7 (Begins 6/13/09 & Ends 6/20/09)

25 Chapter 4: Audit Evidence and Audit Documentation Every MC, exercise in each chapter
covered in this course is useful. Do as
Chapter 10: Auditing the Revenue Process many as you can.
Chapter 11: Auditing the Purchasing Process

July 2 Chapter 12: Auditing the Human Resource Management Process Every MC, exercise in each chapter
covered in this course is useful. Do as
Chapter 13: Auditing the Inventory Management Process many as you can.
Chapter 14: Auditing the Financing Process

9 Chapter 15: Auditing the Financing Process

Chapter 16: Auditing the Financing Process
Online Exam 2 Ch. 4 & 10-16 (Begins 7/11/09 & Ends 7/18/09)
16 Chapter 8: Audit Sampling Every MC, exercise in each chapter
covered in this course is useful. Do as
Chapter 9: Audit Sampling many as you can.

23 Chapter 17: Completing the Engagement Every MC, exercise in each chapter
covered in this course is useful. Do as
Chapter 18: Reports on Audited Financial Statements many as you can.

30 Chapter 19: Quality Control Every MC, exercise in each chapter

covered in this course is useful. Do as
Chapter 20: Legal Liability many as you can.
Chapter 21: Assurance, Attestation, and Internal Auditing Services

August 6 Comprehensive In Class Final Exam: Chapters 1-21

Please bring SCANTRON Form 882-E

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Course Policies
Grading A = 540, B = 480, C = 420
Criteria
Two online examinations @ 150 pts each 300
Comprehensive final 300
Total available points 600
Examinations There will be three examinations in this course. The format of the first two examinations will
be 75 multiple choice questions taken online.
You will have 2.5 hours (150 minutes) to complete each examination, and the exam can only
be accessed once within the scheduled time window.

You can access these examinations by clicking the Assessments link on the course menu and
then clicking the available link. Please read the onscreen instructions carefully before you
click the “Begin Assessment”. After each examination is graded and released, you may go
back to the Assessments page and click the “View All Submissions” to review your results.

The format of the third examination is comprehensive and consists of 120 multiple choice or
matching questions (or a combination of the two). The third examination will be a closed-
book, proctored in class mandatory examination. You will have 4 hours (240 minutes) to
complete the final examination.

All examinations must be taken during the scheduled “Exam Windows”.

Make-up No make-up examinations
Exams
Extra Credit No extra credit
WebCT This course will use a web course tool called WebCT. Students will use their UTD NetID
account to login to the course at: UTD Galaxy: http://galaxy.utdallas.edu or at
http://webct6.utdallas.edu.

To get started with a WebCT course, please see the Getting Started: Student WebCT
Orientation.

UTD provides eLearning technical support 24 hours a day and 7 days a week. The improved
services include a toll free telephone number for immediate assistance (1-866-588-3192),
email request service, and an online chat service. The UTD user community can also access
the support resources such as self-help resources and a Knowledge Base. Please use this
link to access the UTD eLearning Support Center: http://www.utdallas.edu/elearninghelp.

Certain features such as mail and the discussion boards have been disabled in this course. Only
e-mails sent to the e-mail addresses listed in the syllabus will be received.
Server The university is committed to providing a reliable online course system to all users.
Unavailability However, in the event of any unexpected server outage or any unusual technical difficulty
or Other which prevents students from completing a time sensitive assessment activity, the instructor
Technical will extend the time windows and provide an appropriate accommodation based on the
Difficulties situation. Students should report any problems to the instructor and also email
somelearning@utdallas.edu. The instructor and the SOM eLearning Team will respond to
student’s request at the earliest possible time during the next working day.

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Class Required at all classes.
Attendance
Effective Class Explanations: An essential skill for an auditor is the ability to articulate
carefully analysis and to convince others of recommendations based on such analysis.
Active class participation by students is an essential part of the learning experience in this
course. Your ability to express your idea concisely, accurately, and under pressure is
enhanced through regular participation. Your comments can also enhance the learning
experience of your classmates. Regular presentation of your ideas sharpens your mastery of the
subject matter.
Electronic The use of electronic devices in class (except for calculators) is prohibited in class.
Devices
Classroom My expectations of you:
Citizenship I expect you to obtain an understanding of the nature of governmental entities as well as to
understand how the activities in a nonprofit business organization and be able to discern the
motive rules and accounting that govern these entities. I also expect you to focus on the
audit part of these entities and be well aware of the increased responsibilities of the auditor
under GAAS, GAGAS, PCAOB and SAA.

I will hold you responsible for a thorough understanding of all material presented in class as
well as all text material, any additional handouts that I may provide, and any assigned
material. The knowledge you will need in this class will not accrue only from your textbook.
I expect you to perform research and acquire knowledge or information to supplement the
issues presented or discussed in class. I expect you to participate.

My responsibilities:

I will prepare diligently. I will introduce the concepts and mechanics with examples and
lectures. I will also go over selected problems to help you become comfortable with the
material. I will use a mixture of lecture and problem solving, analysis and common sense.
I will always make time to answer your questions.

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Student The University of Texas System and The University of Texas at Dallas have rules and
Conduct and regulations for the orderly and efficient conduct of their business. It is the responsibility of
Discipline each student and each student organization to be knowledgeable about the rules and
regulations which govern student conduct and activities. General information on student
conduct and discipline is contained in the UTD publication, A to Z Guide, which is provided
to all registered students each academic year.

The University of Texas at Dallas administers student discipline within the procedures of
recognized and established due process. Procedures are defined and described in the Rules
and Regulations, Board of Regents, The University of Texas System, Part 1, Chapter VI,
Section 3, and in Title V, Rules on Student Services and Activities of the university’s
Handbook of Operating Procedures.

Copies of these rules and regulations are available to students in the Office of the Dean of
Students, where staff members are available to assist students in interpreting the rules and
regulations (SU 1.602, 972/883-6391).

A student at the university neither loses the rights nor escapes the responsibilities of
citizenship. He or she is expected to obey federal, state, and local laws as well as the
Regents’ Rules, university regulations, and administrative rules. Students are subject to
discipline for violating the standards of conduct whether such conduct takes place on or off
campus, or whether civil or criminal penalties are also imposed for such conduct.

Academic The faculty expects from its students a high level of responsibility and academic honesty.
Integrity Because the value of an academic degree depends upon the absolute integrity of the work
done by the student for that degree, it is imperative that a student demonstrate a high
standard of individual honor in his or her scholastic work.

Scholastic dishonesty includes, but is not limited to, statements, acts or omissions related to
applications for enrollment or the award of a degree, and/or the submission as one’s own
work or material that is not one’s own. As a general rule, scholastic dishonesty involves one
of the following acts: cheating, plagiarism, collusion and/or falsifying academic records.
Students suspected of academic dishonesty are subject to disciplinary proceedings.

Plagiarism, especially from the web, from portions of papers for other classes, and from any
other source is unacceptable and will be dealt with under the university’s policy on
plagiarism (see general catalog for details). This course will use the resources of
turnitin.com, which searches the web for possible plagiarism and is over 90% effective.
Email Use The University of Texas at Dallas recognizes the value and efficiency of communication
between faculty/staff and students through electronic mail. At the same time, email raises
some issues concerning security and the identity of each individual in an email exchange.
The university encourages all official student email correspondence be sent only to a
student’s U.T. Dallas email address and that faculty and staff consider email from students
official only if it originates from a UTD student account. This allows the university to
maintain a high degree of confidence in the identity of all individual corresponding and the
security of the transmitted information. UTD furnishes each student with a free email
account that is to be used in all communication with university personnel. The Department
of Information Resources at U.T. Dallas provides a method for students to have their U.T.
Dallas mail forwarded to other accounts.

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Withdrawal The administration of this institution has set deadlines for withdrawal of any college-level
from Class courses. These dates and times are published in that semester's course catalog.
Administration procedures must be followed. It is the student's responsibility to handle
withdrawal requirements from any class. In other words, I cannot drop or withdraw any
student. You must do the proper paperwork to ensure that you will not receive a final grade
of "F" in a course if you choose not to attend the class once you are enrolled. Last day to
drop the course with a "W": July 20, 2009
Student Procedures for student grievances are found in Title V, Rules on Student Services and
Grievance Activities, of the university’s Handbook of Operating Procedures.
Procedures
In attempting to resolve any student grievance regarding grades, evaluations, or other
fulfillments of academic responsibility, it is the obligation of the student first to make a
serious effort to resolve the matter with the instructor, supervisor, administrator, or
committee with whom the grievance originates (hereafter called “the respondent”).
Individual faculty members retain primary responsibility for assigning grades and
evaluations. If the matter cannot be resolved at that level, the grievance must be submitted
in writing to the respondent with a copy of the respondent’s School Dean. If the matter is
not resolved by the written response provided by the respondent, the student may submit a
written appeal to the School Dean. If the grievance is not resolved by the School Dean’s
decision, the student may make a written appeal to the Dean of Graduate or Undergraduate
Education, and the deal will appoint and convene an Academic Appeals Panel. The decision
of the Academic Appeals Panel is final. The results of the academic appeals process will be
distributed to all involved parties.

Copies of these rules and regulations are available to students in the Office of the Dean of
Students, where staff members are available to assist students in interpreting the rules and
regulations.
Incomplete As per university policy, incomplete grades will be granted only for work unavoidably missed at
Grades the semester’s end and only if 70% of the course work has been completed. An incomplete grade
must be resolved within eight (8) weeks from the first day of the subsequent long semester. If the
required work to complete the course and to remove the incomplete grade is not submitted by the
specified deadline, the incomplete grade is changed automatically to a grade of F. You must do
the proper paperwork to ensure that you will not receive a final grade of "F" in the course.

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Disability The goal of Disability Services is to provide students with disabilities educational opportunities
Services equal to those of their non-disabled peers. Disability Services is located in room 1.610 in the
Student Union. Office hours are Monday and Thursday, 8:30 a.m. to 6:30 p.m.; Tuesday and
Wednesday, 8:30 a.m. to 7:30 p.m.; and Friday, 8:30 a.m. to 5:30 p.m.

The contact information for the Office of Disability Services is:

The University of Texas at Dallas, SU 22
PO Box 830688
Richardson, Texas 75083-0688
(972) 883-2098 (voice or TTY)

Essentially, the law requires that colleges and universities make those reasonable adjustments
necessary to eliminate discrimination on the basis of disability. For example, it may be necessary
to remove classroom prohibitions against tape recorders or animals (in the case of dog guides) for
students who are blind. Occasionally an assignment requirement may be substituted (for example,
a research paper versus an oral presentation for a student who is hearing impaired). Classes
enrolled students with mobility impairments may have to be rescheduled in accessible facilities.
The college or university may need to provide special services such as registration, note-taking, or
mobility assistance.

It is the student’s responsibility to notify his or her professors of the need for such an
accommodation. Disability Services provides students with letters to present to faculty members
to verify that the student has a disability and needs accommodations. Individuals requiring special
accommodation should contact the professor after class or during office hours.
The University of Texas at Dallas will excuse a student from class or other required activities for
the travel to an d observance of a religious holy day for a religion whose places of worship are
exempt from property tax under Section 11.20, Tax Code, Texas Code Annotated

Religious The University of Texas at Dallas will excuse a student from class or other required
Holy Days activities for the travel to and observation of a religious holy day for a religion whose places
of worship are exempt from property tax under Section 11.20, Tax Code, Texas Code Annotated.

The student is encouraged to notify the instructor or activity sponsor as soon as possible
regarding the absence, preferably in advance of the assignment. The student, so excused,
will be allowed to take the exam or complete the assignment within a reasonable time after
the absence: a period equal to the length of the absence, up to a maximum of one week. A
student who notifies the instructor and completes any missed exam or assignment may not
be penalized for the absence. A student who fails to complete the exam or assignment
within the prescribed period may receive a failing grade for that exam or assignment.

If a student or an instructor disagrees about the nature of the absence [i.e., for the purpose of
observing a religious holy day] or if there is similar disagreement about whether the student
has been given a reasonable time to complete any missed assignments or examinations,
either the student or the instructor may request a ruling from the chief executive officer of
the institution, or his or her designee. The chief executive officer or designee must take into
account the legislative intent of TEC 51.911(b), and the student and instructor will abide by
the decision of the chief executive officer or designee.

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Off-Campus Off-campus, out-of-state, and foreign instruction and activities are subject to state law and
Instruction University policies and procedures regarding travel and risk-related activities. Information
and Course regarding these rules and regulations may be found at
Activities http://www.utdallas.edu/BusinessAffairs/Travel_Risk_Activities.htm. Additional information
is available from the office of the school dean.

Strategies To further ensure your success, I suggest you follow these strategies:
For Success: There is no special secret to succeeding in this course. Most students who are committed
to the “5 Ps” have little trouble:

Preparation. Do the assigned readings so that the class explanation will mean more.
Apply your knowledge to problem solving, the more you solve, the better you learn.
Preparation is success.
Presence. If you are not present, then you cannot learn and you cannot add your
expertise to the group explanation. Exchange contact data with a classmate so that if
you miss a class you stay informed.
Promptness.
Participation. Each student’s learning is best facilitated by regular participation. Each
student is responsible for sharing his or her understanding and judgment with the
class to advance the group’s collective skills and knowledge.
Practice. Do enough exercises to turn the “theoretical information” into “practical
skills”
Re-do homework, to become proficient. Copying solutions ≠ working problems.
Analyze and learn from your mistakes. Failure is a great way to learn.
“Read the English!” If you understand the question you will solve the problem.
Method of The theory and philosophy of accounting for Auditing will be presented through lectures,
Presentation: handouts and overhead transparencies as needed. The student’s participation is essential. Each
class will have assigned topics and chapters readings. Begin each class with a lecture designed
to provide structure to the material and to clarify the learning Objectives surrounding the topic.
The remainder of class will be used to explain the relevance and essence of the assigned
reading, to practice applying the theories and techniques, and to consider related current
developments.

In my experience, the most effective way for adults to learn about auditing issues and develop
related skills is through experiential learning. Accordingly, a major emphasis of this course will
involve exercises, decision-making, problem-solving and collaborative learning. The assignments
are designed to provide the individual learner with opportunities to develop greater awareness of
the decision-making process and to enhance skills in audit planning and implementation.
Confucius best captures the specific contribution of the experiential exercises to the overall
development of the learner’s capabilities in this statement:

I HEAR AND I FORGET, I SEE AND I REMEMBER, I DO AND I UNDERSTAND

The text and reading materials are intended to provide each student with knowledge of and
practice relating to current theories, concepts, models, and tools. This information and these
skills can assist the student in developing an ability to design effective problem solutions. It is
assumed that you have thoroughly read and worked through the examples prior to the class
sessions. The knowledge and skills gained are cumulative. The student is expected to utilize all
previously learned material in any particular analysis.

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Course Objectives:
Learning Goals/Objectives
“What is it that you want your students to get
from this class?”
1) Distinguish ethical and unethical behavior in
personal and professional contexts as it relates to
audit. Resolve ethical dilemmas using an ethical
framework, and explain the importance of ethical
conduct for the accounting profession as a whole
solely charged with the public interest.
2) Students will understand compare and contrast
the objectives, differences and similarities between
internal auditing (CIA objectivity and competence)
and external auditing (CPA independence, integrity).
Furthermore, they will learn the goals,
responsibilities, and reporting levels applicable to
public companies (Public Company Accounting
Oversight Board—PCAOB-SOX) and private
companies (Auditing Standard Board—ASB-
AICPA).
3) Students will display understanding the auditor
responsibilities as applicable to Audit Attestation
and Assurance Services.
Learning Outcome/Assessment
“How will I assess the stated learning objective?”
1) Test questions that require the students to compare
and contrast ethical and unethical behaviors.
2) Test their understanding through world problems so that
they can master the purpose and content of the AICPA
Code of Professional Conduct.
3) Test their understanding, interpretation, requirements
and enforcement mechanisms as relate to the Code of
Professional Conduct through Multiple Choices and word
problems
1) Test questions that require the students to recognize,
compare and contrast the two broad differences –basic
skills.
2) Required them to identify and negotiating conflict
resolutions between internal and external auditors by
interpreting and analyzing dilemmas in hypothetical cases
using exercises and word problems—thinking skills.
3) Present information through cases and problems to
showcase the decision-making skills in identifying the
entities and the standard setting authorities. The students
will use Microsoft Excel for spreadsheets (mathematical
calculations), Microsoft Word for written memos and
conclusions to submit their work performed and to
document their research using the Internet (research about
the industry) writing proficiency skills, technologies skills,
problem solving skills.
1) Test questions of real-world situations where the
students can demonstrate appropriate thinking skills,
reasoning skills, and recognition skills to identify which
services are being performed.
2) Ask the students to write short papers comparing the
role of the auditor rendering an opinion and the auditor at
the Oscar ceremony, or at the state lottery, at e-commerce
functions, or compliance of financial provisions for a loan.
3) Through case discussions and term paper on realworld
company under audit. Writing in the field of auditing must
be succinct. It is easy to write too much. Students’ writing
must reflect that understanding and they will have a chance
to enhance appropriate techniques and writing skills by
doing.
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4) Clearly understand that the reason for the audit is
to add credibility to management assertions. Often
there is an adversarial relationship between the
auditor and management. The “Professional
Skepticism” concept plays a vital role throughout the
field work, the accumulation of evidence and the
rendering of an opinion.
Thank you for choosing my class!
1) Test questions about details relationship between
objectives and accumulations of audit evidence.
2) Test questions about statistical sampling techniques to
determine “When is enough evidence-enough?” Working
papers represent the conventions of evidence, format,
usage, and documentation in the accounting field.
Some working papers are in the form of spreadsheets,
others are in the form of memos summarizing discussions
and observations. Each student is required to write one
memo about the strength of evidential matter and
conclusions reached. The conclusions, in the form of
written memos, must be succinct, easy to understand, and
supported by reasonable evidence. Students must be able
to identify elements of evidence that are more important
than others.
Auditors must often balance audit effectiveness with audit
efficiency. Writing the memo will require the student to
maximize resource allocations (time, money, human
resources) in documenting performed audit procedure.
3) Test questions about the procedures available to the
auditor to achieve desired objectives about assertions and
reasonably assure the stockholders
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