How do I add a Risk to an engagement in CCH Axcess™ Knowledge Coach?

  • Article Type:
  • How To
  • Last Modified:
  • 12/18/2019

Objectives

To be able to add Financial Statement Level Risks or Specific Risks to an engagement in CCH Axcess Knowledge Coach.

Environment

  • CCH Axcess
  • CCH Axcess Knowledge Coach
  • Risk Summary

Procedure

This video shows how to add Risks to engagements in CCH Axcess™ Knowledge Coach.


Risk information flows to various forms, as applicable, so that you always see the risk information you need to work with in the context of appropriate forms.


Financial Statement Level Risks- [Return to Top]

Financial statement level risks display in the Financial Statement Level Risks table in form KBA-502 Summary of Risk Assessment. They also are in all substantive audit programs1.

When you add a financial statement level risk, you can document a planned overall response and, if needed, link program steps in a substantive audit program to the risk.
  • Note: By default, one financial statement level risk, Management Override, is provided. You can edit the description and add a planned overall response for this risk. You cannot, however, rename or delete it.
You must be in a financial statement audit form to add a financial statement level risk. If someone else is the active user of KBA-502, you cannot add a risk until that user submits their changes and is no longer the active user of that form. The moment you start entering information to create a risk, you become the active user of KBA-502. When you click Add Risk or Reset Risk Form, you will no longer be the active user.

To add a Financial Statement Level Risk, do the following:
  1. While in the engagement view or a form view for an engagement, click Risk Summary located on the right-side of the screen.
  2. On the Risks screen, click the Financial Statement Level Risk section to expand it.
  3. In Title, enter the title.
  4. In Risk name, enter a unique name of up to 30 characters. You will use this name to link program steps to the risk.
    • Note: You cannot use the pound sign (#) or the pipe symbol (|) in this field.
  5. In Risk Description, enter information about the risk.
  6. In Type of risk, Select one or more options as needed.
    • Note: See the instructions in KBA-502 Summary of Risk Assessments for information on the factors to consider when determining if a risk is significant
      or might be related to fraud.
  7. In Planned overall response, enter responses to the risk. See the instructions in KBA-502 Summary of Risk Assessments for possible responses. 
    • Note: You must make a selection here to clear the Unaddressed Risk diagnostic for a particular risk.
  8. In Form Identified in, KBA-502 is selected by default. You can select a different option if needed. In audit programs, this selection results in the risk being added to the list of findings in the Results section of the
    audit program.
  9. Click Add Risk to save the information.


Specific Risks - [Return to Top]

Specific risks display in the Specific Risks table in KBA-502 Summary of Risk Assessments. They also flow to the substantive audit programs1 for each audit area the risk is associated with. You can also view the risk in the Risk Summary section.

If needed, you can link program steps in a substantive audit program to a specific risk using the unique risk name.

If no specific risks are created for a significant audit area, information to this effect displays in various parts of the form. For example, in KBA-502 Summary of Risk Assessments, you’ll see a row that says “No risks have been added for this area.”

You must be in a financial statement audit form to add a financial statement level risk.

The moment you start entering information to create a risk, you become the active user of KBA-502. When you click Add Risk or Reset Risk Form, you will no longer be the active user. The moment you start entering information to create a risk, you become the active user of KBA-502. When you click Add Risk or Reset Risk Form, you will no longer be the active user.

To add a Specific Risk, do the following:

  1. While in the engagement view or a form view for an engagement, click Risk Summary.
  2. On the Risks screen, click the Specific Risk section to expand it.
  3. In Title, enter the title.
  4. In Risk name, enter a unique name of up to 30 characters. You will use this name to link program steps to the risk.
    • Note: You cannot use the pound sign (#) or the pipe symbol (|) in this field.
  5. In Risk Description, enter information about the risk.
  6. In Type of risk, Select one or more options as needed.
    • Note: See the instructions in KBA-502 Summary of Risk Assessments for information on the factors to consider when determining if a risk is significant
      or might be related to fraud. A risk might also require tests of controls, where substantive tests alone are not sufficient.
  7. In Audit areas affected by the risk, select one or more audit areas that are impacted by the risk. All audit areas are shown here, including custom audit areas you have added.
  8. In Cash transaction cycle, select which cash transaction cycle applies to the identified risk.
    • Note: This field is only required for audit areas Cash and Other Revenues and Expenses.
  9. In Relevant assertions, choose any of the following:
    • EO. Existence or Occurrence
    • RO. Rights and Obligations
    • CO. Completeness
    • AV. Allocation or Valuation
    • CU. Cutoff
    • UC. Understandability or Classification
    • Note: The assertion definitions change with the clarified version of the titles.
  10. In Controls, if any, that mitigate specific risk, evaluate the design of controls for each significant risk or fraud risk. The magnitude of a risk depends in part on whether controls are in place to mitigate those risks.
  11. In Combined risk assessment, Inherent Risk (IR) is combined with Control Risk (CR) to determine the Risk of Material Misstatement (RMM) for each risk. The RMM level will be recommended for you, based on the
    table found in the instructions at KBA-502 Summary of Risk Assessments.
  12. In Planned audit approach, choose from the following:
    • Combined Approach. Audit plan consists of both tests of controls and substantive tests.
    • Substantive: Analytical. Audit plan consists primarily of analytical procedures.
    • Substantive: In-Depth. Audit plan consists of both analytical procedures and tests of details.
  13. In Comment on planned audit approach, enter a brief description of the work you are planning to act as a guide for linking specific program steps to this risk when you design the audit program.
  14. In Form identified in, KBA-502 is selected by default. You can select a different option if needed. In audit programs, this selection results in the risk being added to the list of Findings in the Results section of the
    audit program.
  15. Click Add Risk to save the information.

Additional Information

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