[Kris.tina]

Hi Everyone!

I’m currently taking Becker in preparation for my AUD exam on Feb. 10th. I am finishing up chapter 4: Audit Evidence.

My question is: How important is it for me to know how to calculate the financial ratios? A lot of the simulations in the chapter have asked me to calculate the ratios, but the lecture said it isn’t paramount to the AUD exam?

Thanks!
Kris

AUD - 02/10/2014 PASSED!
REG - 05/14/2014 PASSED!
FAR - 08/25/2014 PASSED!
BEC - 11/10/2014, 02/22/2015 PASSED!

[Texas CPA]

Understanding and knowing financial ratios will help with all the exams except REG.

Reg - Passed 82 Nov 2012 - Becker
Aud - Passed 86 May 2013 - Becker
BEC - Passed 88 Aug 2013 - Becker
FAR - Passed 88 Nov 2013 - Becker

https://www.becker.com/cpa-review

Texas CPA

[Texas CPA]

Understanding and knowing financial ratios will help with all the exams except REG.

Reg - Passed 82 Nov 2012 - Becker
Aud - Passed 86 May 2013 - Becker
BEC - Passed 88 Aug 2013 - Becker
FAR - Passed 88 Nov 2013 - Becker

https://www.becker.com/cpa-review

Texas CPA

[nika_cpa]

Ratios are important for AUD simulations. You may see on the actual exam simulations requiring you to answer questions on how certain events affect these ratios.

Becker self-study, Wiley Test Bank and books, Becker final review. NINJA MCQ bank and NINJA notes for BEC only!

AUD - PASSED!
FAR - PASSED!
REG - PASSED!
BEC - PASSED!

[nika_cpa]

Ratios are important for AUD simulations. You may see on the actual exam simulations requiring you to answer questions on how certain events affect these ratios.

Becker self-study, Wiley Test Bank and books, Becker final review. NINJA MCQ bank and NINJA notes for BEC only!

AUD - PASSED!
FAR - PASSED!
REG - PASSED!
BEC - PASSED!

[Anonymous]

Very important. A lot of FAR crossover.

[Anonymous]

Very important. A lot of FAR crossover.

[Kris.tina]

Thanks everyone for your input!

Thanks!
Kris

AUD - 02/10/2014 PASSED!
REG - 05/14/2014 PASSED!
FAR - 08/25/2014 PASSED!
BEC - 11/10/2014, 02/22/2015 PASSED!

[Kris.tina]

Thanks everyone for your input!

Thanks!
Kris

AUD - 02/10/2014 PASSED!
REG - 05/14/2014 PASSED!
FAR - 08/25/2014 PASSED!
BEC - 11/10/2014, 02/22/2015 PASSED!

[mystical guy]

Maybe it's just me, but it seems AUD emphasizes understanding rather than calculation of the ratios.

CPA - Since 2015
CISA - Smashed 2012
CIA - Passed 2015

[mystical guy]

Maybe it's just me, but it seems AUD emphasizes understanding rather than calculation of the ratios.

CPA - Since 2015
CISA - Smashed 2012
CIA - Passed 2015

[Kris.tina]

@mystical guy, that's what I'm banking on, but the SIMS for the Becker chapter asks for us to calculate some of them.

Thanks!
Kris

AUD - 02/10/2014 PASSED!
REG - 05/14/2014 PASSED!
FAR - 08/25/2014 PASSED!
BEC - 11/10/2014, 02/22/2015 PASSED!

[Kris.tina]

@mystical guy, that's what I'm banking on, but the SIMS for the Becker chapter asks for us to calculate some of them.

Thanks!
Kris

AUD - 02/10/2014 PASSED!
REG - 05/14/2014 PASSED!
FAR - 08/25/2014 PASSED!
BEC - 11/10/2014, 02/22/2015 PASSED!

[M.O.D.]

Compromise.

Memorize the ones you find easy and/or like.

Analytics is in the first part of the audit, the study of ratios, as they compare with industry ratios.

This is required to identify things that are way out of place, like gross margins, ROI, inventory turnover, debt ratios, current assets ratios. Knowing this will save a lot of time going into the audit as well as pinpoint areas to audit, as well as potential business risks.

So yes, you should know these. Investment related ratios may not be as important, but operational ratios, yes.

BA Mathematics, UC Berkeley
Certificates in CPA and EA preparation, College of San Mateo
CMA I 420, II 470
FAR 91, AUD Feb 2015 (Gleim self-study)

[M.O.D.]

Compromise.

Memorize the ones you find easy and/or like.

Analytics is in the first part of the audit, the study of ratios, as they compare with industry ratios.

This is required to identify things that are way out of place, like gross margins, ROI, inventory turnover, debt ratios, current assets ratios. Knowing this will save a lot of time going into the audit as well as pinpoint areas to audit, as well as potential business risks.

So yes, you should know these. Investment related ratios may not be as important, but operational ratios, yes.

BA Mathematics, UC Berkeley
Certificates in CPA and EA preparation, College of San Mateo
CMA I 420, II 470
FAR 91, AUD Feb 2015 (Gleim self-study)

[mla1169]

Mystical I agree that it is more important to know what the ratio indicates than knowing the numerator and denominator. BUT at the same time knowing what each ratio means gives you a good clue as to how to calculate them!

FAR- 77
AUD -49, 71, 84
REG -56,75!
BEC -75

Massachusetts CPA (non reporting) since 3/12.

[Author]

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