Lesson: Engagement Planning, Scope, & Timing Practice Questions

Instructor: Nick Palazzolo

In this lesson, Nick Palazzolo, CPA, tackles multiple choice questions on the topic of engagement planning, scope, and timing in the audit process. He emphasizes the importance of recognizing the phase and type of audit and discusses the role of communication during the planning stage. The lesson covers the use of analytical procedures, the difference between integrated and non-integrated audits, and key messages to communicate to those charged with governance. Using a combination of process of elimination and referencing previous lessons, this lesson aims to deepen understanding and strengthen the skills of handling multiple-choice questions related to engagement planning, scope, and timing.

Updated: June 22, 2023 Create an account

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Engagement Planning, Scope, & Timing Overview

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Transcript

Instructor: Nick Palazzolo

Nick Palazzolo is head instructor of ExamPrep.ai CPA Review. Nick's teaching style is engaging & upbeat, combining practical Big 4 tax & assurance expertise with years of 1-on-1 coaching. His lessons are concise and emphasize what you need to know to pass. Whether you're a recent grad or working full-time, we’re confident you can conquer your CPA exams with Nick’s review.

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Hello, hello. Let's knock through some multiple choice questions on our planning, scope and timing. Jumping right in. Which of the following procedures would a CPA most likely perform in the planning phase of a financial statement audit? All right. As we do with most questions, we think which phase of the audit, which stage of the audit are we in? Well, obviously it's a little given away because we are in this lesson, but you know, when you're taking the exam, these will be all mixed up together. So, yes, we see planning phase and also, you know, we see it's an audit, right? That may be important. It may not be an audit. And then also, is it an issue or a non-issuer? These are just three criteria we should always identify because they may be important. Right. If it's an audit versus a review, there are different different actions we take, different testing procedures we take, you know, different levels of severity. And then also, what phase are we in? That's going to determine what we do in each phase. Right. So in this one, we're asking, what are we doing in the planning phase? So, you know, right away, I'm going to, you know, just go to letter D because I love jumping around. I don't like going in order. That's just me. Recalculate the prior years, accruals and deferrals. So, yes, we would do this during an audit. However, well, this is not done during planning. You don't do hardcore math and testing and all of that. Right. This would be done during the testing phase, not during the planning phase. Similarly here, right, perform cutoff tests and I'm going to spoil it. Right. Inquiries of the client's lawyer. All of these, sure, they're done

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