MA611 - Auditing

Credit Points: 15 credit points

Workload: 36 hours

Prerequisite: MA511 Financial Accounting and Reporting and MA506 Business and Company Law

Co-requisite: N/A

Aims & Objectives

This is a Year 2, Core Unit in the Master of Professional Accounting. For Course Learning Outcomes and further information relating to Master of Professional Accounting program please visit our website:

In this unit, we will apply a flipped classroom instructional strategy to maximise the engagement of students and active learning activities. This strategy will allow instructors to understand students’ difficulties to the maximum level that will facilitate to bring different learning preferences. In this unit we will apply this approach in the following ways:

  • Before the class, instructor will provide a new set of study topics and materials to students to prepare for the upcoming class.
  • During the class, instructor will encourage and engage students to apply and analyse the Pre-assigned task with idea-exchange and feedback approach from the pre class activities stated above.
  • After the class, the instructor will make sure that students are able to practice, develop and create knowledge through the assigned tasks from the in class activities.

Finally the student is totally immersed into all activities from preparing before the class, during and after class.  The culmination of all these activities enriches the student’s overall understanding of the unit at large.

This unit provides an introduction to the underlying concepts and objectives of auditing and the subsequent reporting function of the auditor. Emphasis is placed on both theoretical and practical aspects of auditing. The course aims to give the students a complete picture of the audit process.

This unit will cover the following topics:

  • Assurance and auditing: an overview
  • Audit regulation, structure of the profession and auditor’s liability
  • Ethics, independence and corporate governance
  • Overview of elements of the financial audit process
  • Planning, understanding the entity and evaluating business risk
  • Assessing inherent risk and other specific business risks
  • Understanding and assessing internal control
  • Tests of controls
  • Substantive tests of transactions and balances
  • Completion and review 
  • The auditor’s reporting obligations

Learning Outcomes

Course Learning Outcomes

The Course learning outcomes applicable to this unit are listed on the Melbourne Institute of Technology’s website:  

Unit Learning Outcome

At the completion of this unit, students will be able to: 
a. Explain and apply the principles, practice and process of auditing to practical situations.
b. Interpret the legal and ethical requirements involved in an audit and apply them to diverse situations.
c. Compare and contrast the organisation’s and the auditor’s responsibilities for an audit.
d. Explain the importance of planning an audit and distinguish the steps involved.
e. Identify and critically evaluate the risks inherent in an audit.
f. Research, critique, interpret and communicate current and future auditing issues to specialist and non-specialist audiences.


Assessment Task Due Date A B Unit Learning Outcomes
1. Contribution and Participation Weeks 1-12 - 6% a-f
2. Formative Assessment Week 3 - 4% a
3. Assignment [Individual] Week 6 20% - a-c,d-e
4. Assignment [Group] Week 10 20% - a,f
5. Case Study Analysis [Individual] (3 hours) TBA - 50% a-f
TOTALS   40% 60% 100%

Task Type: Type A: unsupervised, Type B: supervised.

Contribution and Participation (6%)

This unit has class participation as an assessment. The assessment task and marking rubric will follow the Guidelines on Assessing Class Participation ( Further details will be provided in the assessment specification on the type of assessment tasks and the marking rubrics.

Teaching Methods

NOTE: All School of Business units 3-hour workshops Flipped Classroom Mode.

Textbook and Reference Materials

Note: Students are required to purchase the prescribed textbook and have it available each week in class.

Copies of the textbook are available in the MIT Library.

Prescribed Text Book

  • Gay, G, & Simnett, R. (2018). Auditing and Assurance Services in Australia (7th edition). McGraw-Hill Higher Education, Australia.

Other recommended texts

  • Arens, Best, Shailer, Fiedler, Elder, Beasley (2016). Auditing, Assurance Services and Ethics in Australia, 10th edition, Pearson.
  • Johnstone, K., Gramling, A., & Rittenberg, L. E. (2018). Auditing: A Risk-Based Approach to Conducting a Quality Audit, 11th edition. Cengage Learning. 
  • Leung, Coram, Cooper, Richardson (2018). Audit & Assurance, 1st ed. Wiley. 
  • Leung, Coram, Cooper, Richardson (2015). Modern Auditing & Assurance Services, 6th ed. Wiley. 
  • Moroney, Campbell, Hamilton (2017). Auditing - A Practical Approach (3rd edition). Wiley.

Journals and Business publications

  • Dana R. Hermanson, Richard W. Houston, Chad M. Stefaniak, and Anne M. Wilkins (2016). The Work Environment in Large Audit Firms: Current Perceptions and Possible Improvements. Current Issues in Auditing: Fall 2016, Vol. 10, No. 2, pp. A38-A61.
  • Rebecca G. Fay and Sarah E. Stein (2016). Teaching Students About Audit Reports: An Interactive Approach. Current Issues in Auditing: Fall 2016, Vol. 10, No. 2, pp. I14-I25.
  • Michael Kend and Ilias Basioudis (2018). Reforms to the Market for Audit and Assurance Services in the Period after the Global Financial Crisis: Evidence from the UK. Australian Accounting Review, Vol. 28, No. 4, pp. 589-597.
  • David Hay, Jenny Stewart and Nives Botica Redmayne (2017). The Role of Auditing in Corporate Governance in Australia and New Zealand: A Research Synthesis. Australian Accounting Review, Vol 27, No. 4, pp. 457-479.

Check the unit Moodle page for additional recommended readings throughout the trimester.

The Referencing style for this unit is APA: See the MIT Library Referencing webpage: and the Unit Moodle page for additional referencing support material and weblinks.

Graduate Attributes

MIT is committed to ensure the course is current, practical and relevant so that graduates are “work ready” and equipped for life-long learning. In order to accomplish this, the MIT Graduate Attributes identify the required knowledge, skills and attributes that prepare students for the industry.
The level to which Graduate Attributes covered in this unit are as follows:

Ability to communicate Independent and Lifelong Learning Ethics Analytical and Problem Solving Cultural and Global Awareness Team work Specialist knowledge of a field of study


Levels of attainment Extent covered
The attribute is covered by theory and practice, and addressed by assessed activities in which the students always play an active role, e.g. workshops, lab submissions, assignments, demonstrations, tests, examinations.
The attribute is covered by theory or practice, and addressed by assessed activities in which the students mostly play an active role, e.g. discussions, reading, intepreting documents, tests, examinations.
The attribute is discussed in theory or practice; it is addressed by assessed activities in which the students may play an active role, e.g. lectures and discussions, reading, interpretation, workshops, presentations.
The attribute is presented as a side issue in theory or practice; it is not specifically assessed, but it is addressed by activities such as lectures or tutorials.
The attribute is not considered, there is no theory or practice or activities associated with this attribute.