Learning Objectives

Understand why knowledge of an entity's revenue recognition policies is important to the audit.

Understand the revenue process.

Identify the types of transactions in the revenue process and the financial statement accounts affected.

Identify and describe the types of documents and records used in the revenue process.

Understand the functions in the revenue process.

Know the appropriate segregation of duties for the revenue process.

Identify and evaluate inherent risks relevant to the revenue process and related accounts.

Assess control risk for a revenue process.

Identify key internal controls and develop relevant tests of controls for revenue, cash receipts, and sales returns transactions.

Relate the assessment of control risk to substantive testing.

Identify substantive analytical procedures used to audit accounts receivable and revenue-related accounts.

Identify tests of details of transactions used to audit accounts receivable and revenue-related accounts.

Identify tests of details of account balances and disclosures used to audit accounts receivable and revenue-related accounts.

Describe the confirmation process and how confirmations are used to obtain evidence about accounts receivable.

Learn how to audit other types of receivables.

Evaluate the audit findings and reach a final conclusion on accounts receivable and revenue-related accounts.