An introduction to audit theory and techniques and the application of these theoretical concepts to practical situations.


The aim of this Module is to introduce the student to audit theory, concepts and practices, and to develop the student's application of these to practical problems.

Learning Outcomes

By the end of this module the student should be able to:

1.  Critically appraise the social and economic need for auditing and the theoretical, statutory and professional framework within which the external auditor operates. Discuss current issues in auditing

2.  Critically, evaluate risk-based audit strategies, and assess the nature and scope of audit objectives and audit evidence.

3.  Understand the audit process and final report; apply the principles to auditing cases, solving problems therein.

Indicative Content

1 Audit Theory

The postulates of auditing and the enduring principles of auditing. Agency theory and auditing. The nature and value (usefulness) of key accounting information. Internal and External users.

2 Legal and professional considerations

Rules of professional conduct (independence etc.) Quality control and process monitoring. Companies Acts - Legal status of an audit; auditor appointment, resignation and removal; auditor rights, duties and remuneration; professional responsibility and liability.

3 Current issues

The auditor's responsibility for discovering fraud and error; Quality control and monitoring; Corporate Governance; Limiting the auditor's liability; Non- audit engagements undertaken by the auditor.

4 Risk based auditing

Business risk and its impact on audit risk; Analytical procedures; Understanding the industry; Audit planning.

5 Audit objectives

Testing controls; Balance sheet assertions; Types of tests; Types of evidence; Sufficiency and reliability of evidence.

6 The audit process - 1

Specific balance sheet items and related profit and loss account cycles. Audit completion procedures - events after the balance sheet date, contingencies, management representations and the overall review of financial statements.

7 The audit process - 2

Characteristics of information systems and control over systems reliablity. Use of the computer as an audit tool. Applying Computer Assisted Audit Techniques (CAATs). Introduction to group and specialised audits (e.g. Financial services).

8 Reporting and completion

Reports to management. Statutory audit reports. Special reports.

Statement on Teaching, Learning and Assessment

Class contact takes the form of lectures and tutorials. Tutorials and other in-class activities will engage students in enquiry based activities for a minimum of 60% of contact time, developing their skills in the application of audit theory, concepts and practices. Tutorials will be interactive and students will be encouraged to work together. Assessment (100%) takes the form of a scenario based exam.

Teaching and Learning Work Loads

Total 200
Lecture 28
Tutorial/Seminar 10
Supervised Practical Activity 14
Unsupervised Practical Activity 0
Assessment 80
Independent 68

Guidance notes

Credit Value – The total value of SCQF credits for the module. 20 credits are the equivalent of 10 ECTS credits. A full-time student should normally register for 60 SCQF credits per semester.


We make every effort to ensure that the information on our website is accurate but it is possible that some changes may occur prior to the academic year of entry. The modules listed in this catalogue are offered subject to availability during academic year 2019/20 , and may be subject to change for future years.