Overview
Revenue is often one of the largest and most significant line items in a company’s financial statements. It is also the line item that is most susceptible to fraud. Further, all companies reporting under U.S. GAAP have either recently completed or are completing their transition to a complex new accounting standard for recognizing revenue from contracts with customers, ASC 606. Clearly it is imperative that all auditors have a detailed understanding of both ASC 606 and how to effectively audit revenue transactions.
In this session of the Surgent Audit Skills Series, we’ll review the key elements of ASC 606, including the new disclosure requirements for private companies under the new standard. Then, we’ll focus on how to audit revenue, including the elements of an effective risk assessment related to revenue, key controls over the revenue process and substantive procedures. This information with both provides you with the information to audit revenue effectively and efficiently and comply with relevant auditing standards related to revenue. (Please Note: This module is part of Surgent's Audit Skills Training: Level 3.)
Major Topics:
- Topic 606, Revenue from Contracts with Customers, including recently issued ASUs impacting Topic 606
- The FASB’s new five-step revenue recognition model, including hands-on examples and illustrations of the new guidance, including presentation and disclosure requirements
- Performing an effective risk assessment related to revenue
- Common internal controls and substantive audit procedures related to revenue
Learning Objectives:
- The FASB’s comprehensive new revenue recognition guidance in ASC Topic 606, Revenue from Contracts with Customers
- Explaining audit risks associated with revenue
- Discussing how to tailor the audit plan to assessed risks of material misstatement
- Recalling common substantive procedures related to revenue