Lecturer: Polina Vershinina
Class teacher: Olesya Kondrakhina
Principles of Accounting
The course is aimed at 4th year students majoring in Accounting and Finance.
The goal of this course to provide students with an overview on assurance of financial reporting taking into accounting current practice issues. The discipline introduces assurance as a service, its regulation standards and the process and chronology of audit to the students. The aim of Assurance course is to ensure students understand the assurance process and fundamental principles of professional ethics and are able to contribute to the assessment of internal controls and gathering of evidence on an assurance engagement.
Aims of the course:
To introduce students to the general definition of assurance services, various types of assurance projects and its regulation issues;
To provide comprehension by the students on ethical principles of audit profession;
To provide the understanding by the students of general chronology of audit, audit strategy, audit program and audit procedures;
To provide the definition of the internal control system, control activity, to provide on how the financial reporting assertions are related to internal controls, and how the effectiveness of internal controls is assessed;
To provide the view on audit risk assessment, its calculation and importance for audit strategy;
By the end of the course and having completed the Essential reading and activities, students should be able to:
explain why external audits and other types of assurance services are conducted
discuss the duties of auditors and other assurance providers and how these have changed over time
explain the meaning of concepts that are fundamental to auditing and assurance services, such as ‘independence’, ‘audit evidence’, ‘audit risk’, ‘materiality’
describe, in general terms, the processes involved in auditing and other assurance services
distinguish between compliance and substantive testing and describe various audit tests
discuss the form, content and importance of auditors’ reports provided at the end of the audit or assurance service
discuss the issue of legal liability arising from audits and other assurance services
discuss current developments in auditing and other assurance services.
Methods of Instruction
Lectures – taught in English, slides – provided in LMS after each lecture.
Classes are taught in English, class discussions are to be based on questions supplied in main reading books and the Study Guide. Questions from previous LSE exams will be elaborated in classes.
Lectures – 56 hours and seminars – 56 hours, homework – 230 hours
There will be 10 home assignments (approximately every other week) and 2 Interim tests and 1 Final test:
At the end of the 1st Module (i.e. end of October ) students will have to answer 15 MCQ questions, 1 essay question, and 1 case study.
At the end of the 2nd Module (end of December) – 10 MCQs and 2 case studies, and 1 essay question.
Final exam: Format similar to LSE exam: Section A – 4 case studies, Section B – 4 essay questions. Students must attempt at least one question from Section B but cannot do more than two. This means that student will either answer two questions from each section, or three questions from Section A and one question from Section B.
Each home assignment – will be either a case study or essay question
20 % of course grade will be determined based on home assignments, 10% - by classwork, 20% of the course grade will be determined by Interim test 1; 20% - by Interim test 2; 30% - by Final Test.
Gray, I. and S. Manson The audit process. Cengage Learning EMEA; 5th Revised edition (2011) [ISBN 9781408030493].
Porter, B. Principles of external auditing. (Chichester: John Wiley & Sons, 2008) fourth edition [ISBN 9780470974452].
Sherer, M. and S. Turley (eds) Current issues in auditing. (London: Paul Chapman Publishing, 1997) third edition [ISBN 9781853963650].
The concept , process and need for audit and assurance