Many small- and mid-size entities hold less complex investments, including mutual funds, ‘plain vanilla’ derivatives (such as interest rate swaps), and permanent life insurance policies. This module will provide an overview for evaluating the proper recognition, measurement, and disclosure of the most common investment types.

Major Topics:

  • Overview of the most common investment types
  • Typical audit risks and related audit procedures for common investments
  • The basics of accounting for equity investments in other entities
  • Understanding common ‘plain vanilla’ derivatives, like interest rate swaps
  • Fair value disclosure, including applying the fair value hierarchy

 

Learning Objectives
  • Explore and explain typical audit risks associated with auditing the most common investments.
  • Discover and discuss how to tailor the audit plan to assessed risks of material misstatement.
  • Identify and describe the fundamental principles of accounting for common derivatives.
  • Explore and explain fair value presentation and disclosure requirements.
Last updated/reviewed: June 27, 2024

Included In Certifications

This course is included in the following Certification Programs:

13 CoursesAudit Training Certification - Level 2 - Experienced Staff

  1. Fraud Risk - Complying with Minimum Audit Requirements
  2. Best Practices for Identifying and Evaluating Audit Risk - Linking Risk to the Detailed Audit Plan
  3. Testing Internal Controls - Exploring Strategies for Verifying Operating Effectiveness
  4. Inquiry and Research - Improving Critical Audit Skills
  5. Auditing Investments - Understanding Risks and Procedures for the Most Common Investments
  6. Auditing Accounts Receivable - Focusing Procedures for Testing Existence and Valuation
  7. Auditing Liabilities, Including Long-Term Debt - Addressing the Risks of Completeness, Classification, and Disclosure
  8. Substantive Analytic Procedures - Strengthening Evidence to Satisfy Audit Objectives
  9. Sampling - Avoiding Common Mistakes on Financial Statement and Compliance Audits
  10. Desired Traits of a Star Performer - Visualizing How to Become an Exceptional Staff Auditor
  11. Professional Requirements for Assurance Providers, Including Independence - Understanding Critical Code of Professional Conduct Concepts
  12. Accounting Update - Hot Topics for Preparing Current Period Financial Statements
  13. Auditing & Attest Update - Hot Topics for Current Period Audits and Other Attest Services
3 Reviews (14 ratings)

Reviews

5
Member's Profile
This was a great course, I would recommend it to all. The instructor even attempted to include some humor ;)
5
Anonymous Author
Thorough introduction to auditing investments, what to look for and possible procedures
5
Anonymous Author
Hope you can add controls and process flows on investments and derivatives
Prerequisites
Course Complexity: Intermediate

No advanced preparation or prerequisites are required for this course.
Designed For: Accountants responsible for accounting for or auditing less-complex investments, including ‘plain vanilla’ derivatives.

Education Provider Information
Company: Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact: For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Instructor for this course
  Course Overview CPE
Course Syllabus
INTRODUCTION AND OVERVIEW
  Learning Objectives for Auditing Investments1:14
  Introduction16:46
  Equity Securities7:22
  Overview Debt Securities8:42
  Auditing Interest, Dividends, Gains and Losses12:02
  Auditing Equity Method or Consolidated Investments in Other Entities11:36
  Cash Value of Life Insurance Investment5:40
  Property Held for Investment2:46
  Common Derivatives19:42
  Disclosures15:40
CONTINUOUS PLAY
  Auditing Investments - Understanding Risks and Procedures for the Most Common Investments1:41:30
SUPPORTING MATERIAL
  Slides: Auditing Investments - Understanding Risks and Procedures for the Most Common InvestmentsPDF
  Auditing Investments - Understanding Risks and Procedures for the Most Common Investments Glossary/ IndexPDF
REVIEW AND TEST
  REVIEW QUESTIONSquiz
 FINAL EXAMexam