After determining the risk information of the auditee through risk assessment, the auditor should ask

himself if the audit is possible in order to proceed to the next step. Acc to the module there are 3 factors
na kailangang iidenitfyat iconsider ng auditor sa stage na to. First is identifying any third party providers,
identifying risk management strategy and lastly determining the feasibility of the audit. First what are 3 rd
party provider and who delegates them. The client management delegates a 3 rd party and Since ang
management ang may responsibility for internal control and has the authority to delegate a third party
need ni auditor na makipag communicate kay management regarding this. Why because auditor should
know the extent of the outsourcing contract, wc includes the accountability and responsibility of the
outsourcing partner. What is an outsourcing partner? An outside organization chosen by the
management to delegate daily task however failures of the ousourcing org will be shouldered bby the
management . the problem arises here is that it is common that outsourcing org will most likely decline
a request for audit. Or will just supply the auditor a copy of their Service Organization Control (SOC)
report format however often na overstated ang values so hindi siya sapat na pagbasehan. Sinasabi na
kaya may Service Organization Control (SOC) report to avoid being audited individually and they refure
to be audited individually binibigay lang nila to para masabi na nagcomply. And To be abble to conduct
audit the outsource contract should include a provision for the right to audit along the clients
management.

Next is determining risk management strategy. After identifying risk methodologies through risk
assessment stage, the auditor should identify potential risks in this stage. I order to identify potential
risks need ni auditor na kapagtulungan kay client to know what assets to be protected, the threats,
sources of this threats and security issues to be able to foresee and know what is needed to address in
order to fight this threats. Acc to the module there are 4 risk response to effectively document data for
potential risks. First acceptance, accept the fact that high risk might involved the client company. An
auditor should observe professional skepticism in able to be vigilant against the possible worst outcome.
Next is mitigate or reduce, to reduce the impact of risks the auditor should outline comprehensive
preparation including the audit process, the client and even the input. Sinasabi pag nakaoutline and
nakalay out ng maigi to the client company became more copperative and they know how to respond
to auditors need such as required documents. And better cooperation is one example of mitigating risks.
Next response is Transfer,it is possible to transfer the risk but not its liability. Dito na pumapsok yung
sinasabi ko kanina na outsourcing agreements na viable na kumuha ng outside party like subcontractor
or insurance to transfer risks to but dapat nakastate ng maigi ang responsibilities nila sa kanilang
agreement. And lastly, For worst case scenario, the auditor might reject the audit or maybe change the
course of action to avoid taking risks, the information on the risks assessment will help the auditor
predict all the possible risk to happen.

Lastly, at the auditors discretion, determine if the audit is feasible or already possible. The auditor
should ask himself questions to know if it is ready for audit. First question, do u think u can get the job
done with ideal results? The answer will be Based on the evidence on hand and based on the terms of
agreement of the contract, on the knowledge of the auditor on the industry to exert outright
competence, even resources like forming the audit team. Consider all of that, Is the audit objectives
within their capacity and capability if yes then the auditor can proceed to the next question which is are
the goals of the audit realistic? This goas should be included on the agreed terms of audit engagement.
Next do the audit team have the necessary skills to conduct the audit kagaya ng sinabi ko kanina is the
audit along their expertise or are they knowledgeable enough to continue the audit though they have an
option to ask for some experts however working on your field of expertise is already an advantage it
saves time and effort nonetheless. Next , do they have enough time to finish the job this is also included
on the audit engagement agreement, is the scope and time frame reasonable baka naman masyadong
hahapitin yung auditors sa oras limited timeframe means limited audit procedure so hindi maachieve
ideal results kung hindi reasonablelevel ng assurance .And last, do the auditee willing to cooperate?
tingnan yung willingness ni client makipagcooperate kay auditor kasi it will also tell something about
their ethical behaviors in the company, if their being too uptight sa information na need ni auditor then
baka something fishy is already going on. It will taint the clients integrity na agad and maaring
questionable na yung info na makukuha ni audit and masyadong mataas ang risk ng ganitong audit. So
to continue on performing the audit the auditor should be confident to say yes to all this question then
meaning the audit is ready however kung auditors answers nagaalangan na question si audtor kahit isa
lang sa mga questions then the auditor should reconsider or maybe reject the audit.

Acquisition of Property

On CASH BASIS