CPA AUD Study Guide - Auditing & Attestation

Complete study guide for the CPA AUD exam. Covers audit planning, risk assessment, evidence, internal controls, reporting, and ethics.

Flashcards

300

Mini Exams

Full Exams

Format

72 MCQs + 8 TBS

AUD Exam Overview

The AUD section tests your knowledge of the entire audit process. It covers 72 multiple-choice questions and 8 task-based simulations across four testlets. You have 4 hours to complete the section. The passing score is 75. AUD is often considered the most conceptual of the four CPA sections, requiring strong understanding of professional standards rather than heavy calculation.

Audit Planning & Risk Assessment

Audit planning is the foundation of every engagement. You must understand how to accept engagements, establish materiality, identify risks of material misstatement, and design an audit strategy. Key concepts include inherent risk, control risk, detection risk, and the audit risk model (AR = IR x CR x DR). Know how to assess fraud risk factors and understand the requirements of AU-C 240 (Consideration of Fraud).

Audit Evidence & Procedures

Evidence is the core of the audit. Understand the sufficiency and appropriateness of audit evidence. Study the different types of procedures: inspection, observation, inquiry, confirmation, recalculation, reperformance, and analytical procedures. Know when to use positive vs. negative confirmations, how sampling works (attribute and variables sampling), and when to apply substantive vs. test of controls approaches.

Internal Controls

You will be tested on understanding, testing, and evaluating internal controls. Study the COSO framework (five components: control environment, risk assessment, control activities, information and communication, and monitoring). Know the difference between IT general controls and application controls. Understand service organization reports (SOC 1, SOC 2, SOC 3) and how they affect the audit.

Audit Reporting

Reporting is heavily tested on AUD. Master the four types of opinions: unmodified, qualified, adverse, and disclaimer. Understand when each is appropriate. Study emphasis-of-matter and other-matter paragraphs, going concern considerations, comparative financial statements, and supplementary information. Know the differences between reports on single-entity vs. group audits.

Attestation & Review Engagements

Beyond audits, AUD tests your knowledge of other engagement types: reviews, compilations, agreed-upon procedures, and examination engagements. Understand the levels of assurance: reasonable (audit), limited (review), and none (compilation). Study the reporting differences and the procedures specific to each engagement type.

Professional Ethics & Responsibilities

Ethics questions appear throughout AUD. Study the AICPA Code of Professional Conduct, independence requirements (both in fact and appearance), the conceptual framework for independence, and the requirements for objectivity and integrity. Know the rules on contingent fees, advertising, confidentiality, and acts discreditable to the profession.

Study Tips for AUD

Focus on understanding the "why" behind audit procedures rather than memorizing rules. Practice with task-based simulations that require you to apply audit concepts to real scenarios. Review AU-C pronouncements and understand how to reference them. AUD rewards conceptual understanding over rote memorization.