In this guide we will introduce you to the Audit and Assurance exam. We will cover what the Audit and Assurance exam is, what to expect when sitting the exam, common mistakes and how to prepare.
Introducing the Audit and Assurance exam
The exam is 2.5 hours in length and the pass mark is 55%.
The Audit and Assurance exam puts students into situations where they may be evaluating ethical issues, planning an audit and identifying audit risks, commenting, and proposing modifications to audit reports or providing management letter points regarding internal control deficiencies. If you can master these areas, you will do well in this exam.
However, to master these areas requires a good exam technique with application and justification of answers utilising the scenario. This exam is 25% knowledge and 75% application.
For instance, when answering an ethics question, it is not enough just to identify the threat, such as familiarity threat. You need to justify why it is a threat in the context of the scenario. For example, a familiarity threat will mean the auditor may be too trusting or over sympathetic with the client so unable to be sceptical of them, so justify everything.
What to expect when sitting the Audit and Assurance exam
The Audit and Assurance exam is made up of four questions. Question one is six short form questions. And question two, three and four are long form questions with scenarios.
The short form questions should be answered very briefly. They tend to be factual in nature and they are marked based on key words being mentioned. So, try to refrain from paragraphs and sentences and provide your answer in bullet point fashion. These questions should be completed quickly, giving time in the bank for the long form questions.
The long form questions will typically cover elements of ethics, audit risk, audit reports and prospective financial information. They will require depth and application. The scenarios are full of clues to help you answer the questions. So read the scenarios carefully and ask yourself; ‘why is this in the scenario, and how can I use it to answer the question asked?’
Next time you do an Audit and Assurance question look at the mark scheme. The answer usually contains more marks than are possible to get. What we mean by this is that a question worth 20 marks will often have an excess of 20 marks available to be awarded. However, the maximum you can score is 20 marks. So, based on this you need to be very mindful of time management. If you write everything you can think of you will over answer the question and be capped on your marks, and therefore waste time that you should spend on the next question. So, be selective in what you write. Show your competence, prioritise your point and move on as soon as time runs out on that question. Even if you have more things to say. The trick to this exam is to finish the exam!
What to look out for
Common mistakes students make in this exam are:
- Too much content in the short form questions.
- Lack of application and justification of point in long form questions.
- Failure to complete the exam by over answering a particular question.
- If there are numbers in the question, there should be numbers in your answer. Easy analysis marks.
- Ensure you are aware of your open book. Be able to navigate it for tricky points rather than just guessing an answer.
- Know your current issues such as data analytics routines and cyber security.
- Know the examiner favourites such as audit risk and procedures, ethics, audit reports and audit of forecast information.