Knowledge-Based Audits™ Modules
Accounting Research Manager® industry-specific Knowledge-Based Audits™ modules help you mitigate risk and achieve more effective GAAS compliance. These valuable auditing tools give you the resources of the most comprehensive financial reporting online database available — Accounting Research Manager — plus the industry-specific guidance you need to perform accurate and efficient financial audits of the particular nonpublic industries covered.
Knowledge-Based Audits (KBA) modules for specific industries include:
- Knowledge-Based Audits of Construction Companies and Contractors
- Knowledge-Based Audits of Employee Benefit Plans
- Knowledge-Based Audits of Financial Institutions
- Knowledge-Based Audits of Governmental Entities
- Knowledge-Based Audits of Health Care Entities
- Knowledge-Based Audits of Not-for-Profit Entities
- Knowledge-Based Audits of Real Estate Entities
- Knowledge-Based Single Audits
More Accurate Risk Assessments Each KBA module enhances your ability to assess risk. The more accurately you can assess an entity’s risks of material misstatement, the more assurance you have that the procedures performed in response to the risk assessments will detect these misstatements. The KBA methodology helps you:
- Obtain an understanding of the entity and its environment, including its internal control, to accurately assess the risks of material misstatement
- Design and perform audit procedures that are responsive to these risks
CCH Knowledge-Based Audits Methodology
The industry-specific guidance provided by the KBA modules is based on our exclusive KBA methodology. The methodology was designed by CCH to help the auditor efficiently and effectively perform financial statement audits of nonpublic entities in accordance with auditing standards generally accepted in the United States of America (GAAS).
The KBA method is a risk-based audit methodology that emphasizes using knowledge of the entity to make the risk assessments in connection with a financial statement audit. It focuses on information flow rather than document flow. This enhances communication between engagement team members and allows for ongoing evaluation of procedures. The forms, practice aids, and audit programs incorporated in this methodology should be customized to the specific circumstances of the entity being audited or the specific nature of the engagement.
The KBA methodology is presented as nine processes:
- Pre-Engagement Procedures
- Risk Assessment Procedures: Obtaining an Understanding of the Entity and Its Environment
- Risk Assessment Procedures: Evaluating the Design of Internal Controls
- Assessing the Risks of Material Misstatement
- Performing Audit Procedures in Response to Assessed Risks
- Performing Audit Procedures: Tests of the Operating Effectiveness of Internal Controls
- Performing Audit Procedures: Substantive Tests
- Evaluating, Concluding, and Reporting Procedures
- Audit Documentation Requirements
Communications Hub Enhances Information Flow
The results from each audit stage feed into a Communications Hub, which enables audit team members to easily view summaries of the significant matters, risks and findings discovered in the audit. This design ensures that important information is not overlooked or hidden in the details of numerous checklists and forms.
Knowledge-Based Audits Available in Additional Formats
ProSystem fx® Engagement and KnowledgeTools
Knowledge-Based Audits modules are also available as Knowledge Tools add-ons to ProSystem fx® Engagement — the industry’s most widely used paperless workpaper management and trial balance tool. Engagement provides additional integrated features that facilitate sign-off and tailoring of program steps. It also provides context sensitive Practice Points, example workpapers and explanations, and optional workpapers that can automatically be inserted into the audit binder if needed. For more information, visit CCHGroup.com/KnowledgeTools.
Knowledge-Based Audits (KBA) Publication
For practitioners that need access to a printed version of this content, CCH offers the KBA publication – allowing an inexpensive, portable method to learn how to comply with the risk assessment standards. Learn more about Knowledge-Based Audits of Commercial Entities.
| 
