Course Title: Audit and report on financial systems and records

Part B: Course Detail

Teaching Period: Term2 2022

Course Code: ACCT5388C

Course Title: Audit and report on financial systems and records

Important Information:

Please note that this course may have compulsory in-person attendance requirements for some teaching activities. 

To participate in any RMIT course in-person activities or assessment, you will need to comply with RMIT vaccination requirements which are applicable during the duration of the course. This RMIT requirement includes being vaccinated against COVID-19 or holding a valid medical exemption. 

Please read this RMIT Enrolment Procedure as it has important information regarding COVID vaccination and your study at RMIT:

Please read the Student website for additional requirements of in-person attendance: 

Please check your Canvas course shell closer to when the course starts to see if this course requires mandatory in-person attendance. The delivery method of the course might have to change quickly in response to changes in the local state/national directive regarding in-person course attendance. 

School: 525T Business & Enterprise

Campus: City Campus

Program: C6163 - Advanced Diploma of Accounting

Course Contact: Doug Gourlay

Course Contact Phone: +61 3 9925 5944

Course Contact Email:

Name and Contact Details of All Other Relevant Staff

Course Coordinator :   

Meetu Aggarwal

E- mail:

Ph: 9925 1621        

Contact timings:

Monday to Friday: 8:30am - 5:00pm


Nominal Hours: 40

Regardless of the mode of delivery, represent a guide to the relative teaching time and student effort required to successfully achieve a particular competency/module. This may include not only scheduled classes or workplace visits but also the amount of effort required to undertake, evaluate and complete all assessment requirements, including any non-classroom activities.

Pre-requisites and Co-requisites

FNSACC516 Implement and maintain internal control procedures

Course Description

This unit describes the skills and knowledge required to supervise an audit of financial systems and prepare the appropriate reports, including assessing options, identifying information sources, determining audit strategies, monitoring progress, reviewing data, verifying financial statements and determining appropriate reporting formats.

It applies to experienced individuals who use specialised knowledge and systematic approaches to analyse and evaluate financial information against specified criteria and compliance requirements.

Work functions in the occupational areas where this unit may be used are subject to regulatory requirements. Refer to the FNS Implementation Guide Companion Volume or the relevant regulator for specific guidance on requirements.

National Codes, Titles, Elements and Performance Criteria

National Element Code & Title:

FNSACC602 Audit and report on financial systems and records


1. Assess options

Performance Criteria:

1.1 Identify statutory requirements from assessment of terms of reference, and client objectives and obligations 1.2 Review and analyse client activities and procedures to establish familiarity with systems and guide selection of appropriate audit methodologies 1.3 Develop financial audit methodologies to identify significant features of audit and establish criteria for conducting audit in accordance with professional auditing standards


2. Identify information sources

Performance Criteria:

2.1 Identify audit financial data sources from evaluation of organisation's information systems 2.2 Create audit lines of enquiry to support audit objectives and reduce audit risk to acceptable level


3. Determine audit strategies

Performance Criteria:

3.1 Establish client financial business characteristics from analysis of general economy, industry and client's provided information 3.2 Assess client's inherent financial risk through value chain risk analysis 3.3 Identify internal control procedures for financial transactions through discussion with client and established professional standards 3.4 Ensure audit methodologies use established sampling and selection techniques in manner consistent with internal control procedures and substantive testing


4. Schedule resources and timelines and monitor progress

Performance Criteria:

4.1 Establish timeframes and allocate personnel to functions and tasks based on audit lines of enquiry 4.2 Review resource use regularly, and develop and monitor intermittent reports with resource allocation and timeframes adjusted through discussion and agreement with client and in accordance with professional accounting standards


5. Review data and verify statements

Performance Criteria:

5.1 Identify significant strengths and weaknesses in controls and rank in accordance to audit objectives 5.2 Obtain and evaluate evidence on financial systems and controls under review using established testing procedures and in accordance with criteria identified in audit methodology 5.3 Test management assertions to achieve audit objectives 5.4 Gather sufficient appropriate audit evidence as basis for expert opinion 5.5 Verify financial statements as materially misstated or correct


6. Determine reporting formats

Performance Criteria:

6.1 Identify and document financial operational functions, services and systems in accordance with standard formats 6.2 Ensure format is consistent with documentation requirements of auditor and professional auditing standards 6.3 Formulate and provide financial audit opinions, including recommendations, to client in established and acceptable format

Learning Outcomes

Details of Learning Activities

Primarily you will be learning face to face, with an online course site (Canvas) used to disseminate materials, including videos, notes and activities and to provide access to on-line assessments & assessment submission points. Students will be required to read the course text before coming to class. The class is structured so that the reading is completed out of class.

In-class work will account for 32 of the total nominal hours of 40 hours for the course and in-class work will include a range of self-paced and collaborative learning activities such as class discussion, completion and review of set exercises, a team presentation on one chapter of the text book, work on a simulated/real workplace environment assignment based on an organisation with a presentation and audit report to be presented.  

The hours of self-directed/self-paced learning by full-time students (8 of the 40 total nominal hours) will be taken up with reading, research and the completion of the assignment outside scheduled class time. Please note that the format of the class will be a two-hour class per week over 16 weeks.

It is expected that all students participate and contribute in all scheduled learning activities.

Teaching Schedule

The nominal hours associated with this course are a guide only and represent the total teaching time and student effort required to successfully complete the course.  This may include not only scheduled classes but also the amount of effort required to undertake, evaluate and complete all assessment requirements, including any non-classroom activities.  Please refer to Learning Activities with reference to instructions regarding work to be completed outside teaching hours.

Induction Session for all students 

Prior to training commencement a program level induction session will be conducted that comprises the following:

• Program overview and requirements
• MyRMIT/Canvas
• Overview of assessment requirements
• Pre-Training Review including:
o Recognition of Prior Learning and Credit Transfers
o Assessment of current skills and knowledge
• Competency/Grading Criteria
• Plagiarism
• Appeals
• Extensions
• Feedback
• Privacy
• Submission requirements
• Resubmission policy
• Where to get support 
• Student responsibilities.

Weekly schedule 



Class Work and Assessments


Pre-class work:

  • Watching welcome video to familiarise with course and Canvas shell navigation
  • Reading help and support information
  • Understanding RMIT policies and guidelines
  • Checking Collaborate Ultra- Student guide
  • Viewing Course guide information
  • Getting information on required learning resources

Chapter 1 - Introduction to auditing

Chapter 13 - Auditing various entities

Discuss Course and all Assessment requirements

Topics to be discussed in the chapter:

  • what is an audit
  • various types of audit
  • types of engagements
  • aspects of a financial statement audit
  • benefits of a financial statement audit
  • audits of associations, partnerships, trusts, SMSF's

Review Questions

1.1 to 1.5, 13.1


Case study made available on Canvas - to discuss in detail with class


Chapter 2 - Auditing as a profession

Chapter 3 - Audit standards

Topics to be discussed in the chapter:

  • requirements in becoming an auditor
  • characteristics of audit firms
  • ethical issues that affect auditors
  • audit responsibilities under Corporations Act and common law
  • how to limit potential auditor responsibility
  • importance of auditing standards
  • factors influencing scope of an audit
  • responsibility of preparing financial reports
  • importance of audit objectives and assertions

Review Questions
2.1 to 2.5, 3.1 to 3.5

Release of Online Quiz 1


Chapter 4 - Stages of the audit process

Topics to be discussed in the chapter:

  • various stages of an audit

Review Questions
4.1 to 4.6

Release of Online Quiz 2 (Topics 1, 2, 3, 4 to be done outside class)


Chapter 5 - Acceptance, engagement and planning

Topics to be discussed in the chapter:

  • factors to be considered in decision of accepting a new engagement or continue with an existing engagement
  • requirements to draw up an engagement letter
  • aspects of audit planning process
  • client risk
  • audit budget
  • resource allocation and time frame

Review Questions
5.1 to 5.7 


Chapter 6 - Audit Risk and Evidence

Topics to be discussed in the chapter:

  • audit risk and its components
  • indicators of going concern risk
  • significance of evidence in the audit process
  • importance of audit documentation and working papers

Review Questions
6.1 to 6.5


Chapter 7 - Analytical review

Topics to be discussed in the chapter:

  • characteristics and application of analytical review
  • types of analytical procedures
  • calculating financial ratios with an audit emphasis

Review Questions
7.1 and 7.2


Chapter 8 - Preliminary evaluation of internal controls

Discussion of case study - relevance to chapter(s) – Pitstop 1

Topics to be discussed in the chapter:

  • aspects of internal control system
  • preliminary evaluation of internal controls
  • limitations of internal controls
  • report on internal controls

Review Questions
8.1 and 8.2


Chapter 9 - Compliance testing

Topics to be discussed in the chapter:

  • aspects and objectives of compliance testing
  • understanding the entity and its environment
  • documenting compliance testing

Review Questions
9.1 to 9.4


Chapter 10 - Substantive testing 

Topics to be discussed in the chapter:

  • meaning of substantive testing
  • relationship between compliance and substantive testing

Review Questions
10.1 to 10.3


Chapter 11 - Substantive audit programs

Discussion of case study - relevance to chapter(s) – Pitstop 2

Topics to be discussed in the chapter:

  • substantive tests of transactions and balances
  • design substantive tests

Review Questions
11.1 to 11.6


Chapter 12 - Completion and reports

Discussion of case study - relevance to chapter(s) - Pitstop 3

Course experience survey

Topics to be covered in the chapter:

  • contingent liabilities
  • review of events subsequent to balance date
  • audit evaluations and conclusions
  • elements of an audit report
  • various audit opinions

Review Questions
12.1 to 12.6 

Submission of Part A, B and C of Case Study

Feedback will be provided in week 15 and re-submissions in week 16


Discussion of case study - relevance to chapter(s) – Pitstop 4

Discussion of case study - relevance to chapter(s) – Pitstop 4


Presentation of Audit findings to Management

5-10 minute presentation on audit findings related to the Case Study

Submission of Part D of Case Study

Feedback will be provided in week 15 and re-submissions will be in week 16


Discussion of case study - relevance to chapter(s) – Pitstop 5

Submission of Audit Report

Discussion of case study - relevance to chapter(s) – Pitstop 5

Submission of Part E of the Case Study



Re-submissions of Part A, B, C, D and E of the Case Study

Please note:

  1. Mid semester break will be from 29 August to 4 September 2022. Classes will resume from 5 September 2022.
  2. The teaching schedule is subject to change in exceptional circumstances.  Notification of changes can be made directly in class by the teacher or emailed to each student.

Learning Resources

Prescribed Texts

Audit and report on financial systems and records, 4th edition by Lee Homewood, Better Team Publications



Other Resources

Overview of Assessment

Performance Evidence

Evidence of the ability to:

  • assess client risk and determine financial audit strategy and methodology
  • schedule resources and timelines, and monitor progress
  • review data, verify financial statements and determine reporting formats that comply with:
  • organisational financial internal control policy and procedures
  • relevant legislative requirements and professional standards.

Note: If a specific volume or frequency is not stated, then evidence must be provided at least once.

Knowledge Evidence

To complete the unit requirements safely and effectively, the individual must:

  • identify and explain the key features of current financial legislation and statutory requirements relating to internal control, taxable transactions and reporting requirements
  • identify and explain the key features of current, relevant professional accounting standards
  • outline the duties and responsibilities of auditors
  • discuss professional standards and ethical considerations for management and handling of files and records
  • identify and explain the key principles of:
  • auditing
  • internal control
  • compare and contrast testing procedures and methods of enquiry.

Assessment Conditions

Assessment must be conducted in a safe environment where evidence gathered demonstrates consistent performance of typical activities experienced in the accounting field of work and include access to:

  • common office equipment, technology, software and consumables
  • an integrated financial software system and data.

Assessors must satisfy NVR/AQTF assessor requirements.

You are advised that you are likely to be asked to personally demonstrate your assessment work to your teacher to ensure that the relevant competency standards are being met.


Feedback will be provided throughout the semester in class and/or online discussions.  You are encouraged to ask and answer questions during class time and online sessions so that you can obtain feedback on your understanding of the concepts and issues being discussed. Finally, you can email or arrange an appointment with your teacher to gain more feedback on your progress.

You should take note of all feedback received and use this information to improve your learning outcomes and final performance in the course. 

Assessment Tasks

Assessment Task/Titles:  

There is one assessment for this unit but it has a total of five (5) parts. (Due dates: Weeks 12, 14 and 15 respectively)

You will be provided with information about a company called “Red Earth Pty Ltd Pty. Ltd,” from where you will be required to conduct a detailed audit on the financial systems and records of a company. You will also be presenting your audit findings to the management of the business so that it can adjust its financial statements and improve internal controls as suggested by you. You will also be preparing a draft audit report after determining the appropriate reporting format. There are five pit stops planned in weeks 8, 11, 12, 13 and 15 to discuss with the assessor any issues related to this assessment.

This assessment task is made up of the following parts:
Part A - Assessing options, determining audit strategy, developing audit methodology and scheduling resources
Part B - Assessing risk and understanding professional standards
Part C - Review data and verify statements to determine reporting format
Part D - Presentation on significant weaknesses in internal controls
Part E – Issue of Report

Part A, B and C are due in Week 12 
Part D is due in Week 14 
Part E is due in Week 15 

This assessment is competency based and a CA (competent) must be achieved for this assessment.

Your teacher will discuss the assessment matrix for each assessment with the class at the beginning of the semester and prior to the assessment taking place.

You can be asked to re-produce any assessment in front of your teacher.

Assessment Matrix

It will be uploaded on Canvas. Your teacher will discuss it for each assessment with the class at the beginning of the semester and prior to the assessment taking place. 

Other Information

Submission Requirements

 You should: 

·   Ensure that you submit assessments on or before the due date. 

·   Always retain a copy of your assessment tasks. (hard copy and soft copy)

·   When you submit work for assessment at RMIT University you need to use a cover sheet that includes a declaration and statement of authorship. You must complete, sign and submit a cover sheet with all work you submit for assessment, whether individual or group work.  On the cover sheet you declare that the work you are presenting for assessment is your own work.  An assignment cover sheet for submission of each assessment task is available on blackboard.

·   Each page of your assessment should include footer with your name, student number, the title of the assessment, unit code and title and page numbers.   For example, Julie Macpherson, 324567, Task 2, OHS2345C Ensure safe workplace, Page 1 of 10.


Late Submission Procedures

You are required to submit assessment items and/or ensure performance based assessment is completed by the due dates.

If you are prevented from submitting an assessment item on time, by circumstances outside your control, you may apply in advance to your teacher for an extension to the due date of up to seven calendar days.  

More Information:


Where an extension of greater than seven days is needed, you must apply for special consideration.  Applications for special consideration must be submitted no later than two working days after the assessment task deadline or scheduled examination. 

More Information:

Resubmissions (VET Programs):

If you are found to be unsuccessful in a Course Assessment Task you will be allowed one resubmission only.  Your teacher will provide feedback regarding what you need to do to improve and will set a new deadline for the resubmission.  The highest result you will receive if your resubmission is successful is “CA”.

If you are still not meeting the assessment requirements you must apply to your Program Manager in writing outlining the steps you will take to demonstrate competence in your course. Your submission will be considered by the Program Team and you will be advised of the outcome as soon as possible.

Adjustments to Assessment

In certain circumstances students may be eligible for an assessment adjustment. For more information about the circumstances under which the assessment arrangements might be granted please access the following website: 

More Information:


Marking Guide (Competency): 

You must demonstrate that you have all the required skills/knowledge/elements in the unit of competency you are studying. 

You will receive feedback on each assessment task that will inform you about your progress and how well you are performing. You will achieve one of the following results: 

Final results table:

CA    Competency Achieved

NYC  Not Yet Competent

DNS  Did Not Submit Assessment

Course Overview: Access Course Overview