Planning the Audit Coursework Example | Topics and Well Written Essays - 500 words

Planning the Audit - Coursework Example rly attributed to the fact that fraud is often strategic in nature rather than random and the auditors may sometimes fail to detect potential fraud in the low risk audit areas when there is no sufficient audit procedure. One of the major findings of the paper is that the undetected misstatements among low risks accounts are significantly more common than what is suggested by the traditional risk assessment procedures. However, the results of the research particularly suggest that prompting the auditors to consider the how the organizational management may anticipate or exploit the risk assessments of the auditors may significantly help in the reduction of the number of incidences of undetected misstatements. The other important findings of the research include that the management are often more likely to act strategically by targeting the low risk accounts in order to conceal misstatement and auditors normally fail to detect misstatements in low risk accounts. This is largely based on the assumption that auditors would override the already existing process to personally include the misstatement in the low-risk account. This research paper is critically important to the upcoming or the already established auditors in the understanding of risk based instruct in financial statements preparations. This paper instructs the auditors to focus audit attention and resources majorly on the accounts that are preferably considered to be high-risk oriented for a specified audit engagement (Bowlin 2011). One of the implications of this paper to accounting profession is induction measure into strategically low-risk accounts to disguise misstatement. The research methodology used in the research as a basis for the conclusion involved subjecting 123 participants derived from accounting students enrolled in upper-division classes to computer based simulations related to audit engagement. The students were then paired in such a way that one represented an auditor while the other a