【文章內(nèi)容簡介】 s on auditing make numerous references to the need to understand the client’s business and industry when performing a financialstatement audit. Knowledge about the nature of the client’s business activities and related business risks, its organizational structure and internal environment, and its relationships and interactions with its external environment, provides a basis for the auditor’s evaluation of whether financialstatement assertions are valid. In today’s plex and dynamic economic world, obtaining this knowledge is a formidable undertaking. It entails identifying, collecting, and processing a wealth of information about the client’s business and industry that may be relevant to the audit. And, more importantly, it entails integrating this information to form a “wholesystem” representation of how the client organization fits within the broader economic environment, and how effectively its key business processes, working in bination, maintain or strengthen that fit.KPMG has designed and implemented a riskbased strategicsystems auditing approach2 called the Business Measurement Process, or BMP. The BMP audit approach has a topdown, holistic, businessrisk orientation. It guides the focus, breadth and depth of the auditor’s knowledge acquisition, and the integration of business knowledge into expectations about financialstatement assertions. The traditional “riskbased” audit focuses the auditor’s assessment of risk through a narrow “accounting lens” — a lens that directs his attention, and his related assessment and testing activities, to the nature of account balances, classes of transactions, and properties of the client’s accounting system for the purpose of assessing the risk that financialstatement assertions are materially misstated. We believe that this disaggregative, “bottomup” focus can inhibit the auditor’s development of the level of business understanding needed to effectively judge financialstatement assertions. After all, these accounting and processing foci are “human artifacts” that are levels removed from the actual business activities to which they relate.BMP has a very clear strategy focus. It is a riskbased strategicsystems audit approach that focuses the auditor’s assessment of risk through a broader strategicsystems lens — a lens that directs the auditor’s attention to the client’s systems dynamics: its business strategy and the economic niches it has chosen to occupy。 the strengths of its connections to outside economic agents, including customers, suppliers, investors, and regulators。 and the external and internal forces that threaten the viability of its chosen niches and the achievement of its objectives. The BMP auditor collects and integrates information about the client’s business and industry using a client business modeling3 framework. The client business model assists the auditor’s evaluation of the validity of the client’s accounting transactions, and of the financial statements taken as a whole. Use of the topdown, aggregative, strategicsystems lens increases the likelihood that the auditor will have obtained a sufficient understanding of the client’s business and industry for the purpose of conducting a financialstatement audit, and reduces the risk that audit procedures applied to specific highrisk transactions will be prematurely truncated.The purposes of this monograph are to present:? an overview of the theories and trends that suggest a need for a riskbased strategicsystems audit。? a discussion of the systems theory and strategy concepts that underly the riskbased strategicsystems audit。? an overview of some of the business measurement principles, analytical procedures, and tools prising KPMG’s riskbased strategicsystems audit — BMP。 and? examples that illustrate how BMP might be applied to a retail client.We begin the monograph by presenting an overview of current authoritative guidance about the auditor’s need to understand the client’s business and industry. Next, we present a brief historical overview of the role and practice of auditing prior to the latenineteenth century, and of the influence of these past events and conditions on the evolution of auditing practices throughout the twentieth century. The historical perspective helps us to understand how and why audit practices have remained rather narrowly focused on transactions and other organizational subunits over a period when the role of external auditing was expanding, and client businesses and the economy taken as a whole were being more plex.Next, we discuss selected systems and strategy concepts relevant to the auditor’s need to obtain an understanding of the client’s business and industry, and to the manner in which he obtains that understanding. In this section we draw a distinction between the reductionist approach to audit risk assessment — assessing audit risk “through the accounting transactions” — and the strategicsystems approach — assessing audit risk through a topdown, holistic view of the client’s business and its connections and interactions with its environment. We suggest that these perspectives are plements, and that the auditor should assess audit risk from both perspectives to make effective judgments about the validity of the client’s financial statements in today’s plex business environment.Next, we present a proposed knowledge acquisition framework for the “wholesystem” strategic approach for assessing audit risk, followed by a detailed discussion, with illustrations, of some of the business measurement principles and related analytical procedures prising BMP — KPMG’s current working version of such a framework. We conclude the monograph with a philosophical discussion about audit evidence as it relates to the strategicsystemsoriented analytical procedures.2 Current Authoritative Guidance About the Need to Understand the Client’s Business and IndustryThe current authoritative guidance on external audit