F8 – ACRONYM DIRECTORY

ACCA fundamental principles of code of ethics: COPIC

C – Competence: professional knowledge and skill
O – Objectivity: should not allow bias, conflicts of interest or undue influence of others
P – Professional behaviour
I – Integrity: straightforward and honest
C – Confidentiality

Auditor’s consideration deciding whether to accept an audit assignment: PLACE

P – Professional clearance: writing to the leaving auditor
L – Legal considerations: anything that would prevent auditor from doing the job legally; e.g. licensing
A – Auditor considerations: resources, time, skills
C – Commercial considerations: e.g. KOB
E – Ethical consideration

Situations where an auditor leaves: 3Rs

R – Resign
R – Retire
R – Removal

Factors auditor consider before relying on other people’s work: STRIP

S – Scope of work
T – Technical competence
R – Report quality
I – Independence
P – Professionalism

Limitations of internal controls: FAME

F – Fraudulent collusion
A – Abuse of authority
M – Management authority
E – Errors

What are the financial statement assertions: V COD RACE

V – Valuation

C – Completeness: all transactions that should be included, actually included?

O – Occurrence
D – Disclosure

R – Rights and obligations

A – Accuracy
C – Cut-off
E – Existence: actually exists?

Method of tests that the auditor can use: AEIOU + CR

A – Analytical review
E – Enquiry: ask client
I – Inspection: e.g. NCA
O – Observation: watch when it actually happens
U – Recalculation: e.g. depreciation, interest
+
C – Confirmation: by third party; e.g. lawyers, bank, receivables
R – Re-performance: e.g. stock count

General substantive tests that can be used by the auditor: A TOAD

A – Add-up

T – Trial balance
O – Opening balance to last year’s closing (compare)
A – Audit software
D – Disclosure check
mezbah.ahmed@oxfordbrookes.net
http://groups.yahoo.com/group/acca_bd/
Full credit for these acronyms goes to Alison Dundjerovic (Kaplan Financial F8 and P1 lecturer)
 F8 – ACRONYM DIRECTORY

Specific tests can be used for receivables: 3Cs

C – Circularisation
C – Cut-off
C – Cash paid after the y/e

Specific tests can be used for trade payables: CRAP

C – Cut-off
R – Reconcile supplier statement
A – Analytical procedure
P – Post year ending invoice review

Company objectives for internal controls: AS PIE

A – Accurate accounting records
S – Safeguard the assets

P – Prevent and detect fraud

I – Internal policy followed
E – Efficiency

General controls expected in an organisation:

- Good recruitment procedures
- Good training procedures
- Internal audit department
- Management of 3As: Attitude, Awareness, Action
- Incentives

Specific controls expected in an organisation: ACCA MAPS

A – Authorisation
C – Comparison: i.e. analytical review
C – Computer controls: e.g. passwords
A – Arithmetic: i.e. add-up

M – Maintain a trial balance

A – Accounting reconciliations
P – Physical controls
S – Segregation of duties

What should be present in a panning document: MARK SAT

M – Materiality and tolerable error
A – Analytical review
R – Risk
K – KOB

S – Staffing
A – Audit approach
T – Timetable

mezbah.ahmed@oxfordbrookes.net
http://groups.yahoo.com/group/acca_bd/
Full credit for these acronyms goes to Alison Dundjerovic (Kaplan Financial F8 and P1 lecturer)