Back to Basics
Case Overview
How can instructors make foundational audit concepts stick? This learning strategy, published in Issues in Accounting Education, presents six "Back to Basics" classroom exercises designed to help undergraduate and graduate students understand and apply core auditing concepts through analogies and experiential learning. The exercises cover: (1) explaining the demand for audits, (2) introducing materiality, (3) introducing the COSO framework for internal control over financial reporting, (4) explaining management assertions through a petty cash audit, (5) performing sampling and an inventory count, and (6) explaining audit reports. Each exercise is independent, flexible, and adaptable for in-person or online environments — allowing instructors to select and modify the exercises to fit their course objectives and classroom needs.
Learning Outcomes for Students
Can explain why there is a demand for external auditing and how auditors benefit the market.
Can describe the concept of materiality and explain how an auditor's materiality judgment affects the nature and extent of audit procedures.
Can identify and apply the five components of the COSO framework for internal control over financial reporting using the mnemonic "C-R-I-M-E."
Can identify management assertions and apply them to evaluate errors found in an audit of petty cash.
Able to perform nonstatistical audit sampling, conduct a physical inventory count, project identified misstatements to the population, and conclude on an account balance.
Can distinguish among types of audit opinions, identify when each is appropriate, and describe the key elements included in an audit report.
Access to Case Materials
Citation: Andiola, L. M., Aghazadeh, S., Dennis, S. A., Kang, Y. J., Kremin, J., Schaefer, T. J., Sedor, L. M., Westermann, K. D., and Williams, D. 2026. "Back to Basics": Exercises to teach auditing fundamentals. Issues in Accounting Education 41 (1): 61–72.
Access case materials:
https://doi.org/10.2308/ISSUES-2024-024