Audit planning, Documentation and Group Audits Flashcards
What is the purpose of audit planning?
To perform the audit in an effective and efficient matter
What standard covers audit ?
NZISA 300 - Planning an audit of financial statements
What are the key steps at the beginning of an audit?
- Review client continuance procedures
- Evaluate compliance with ethical requirements
- Understand the terms of the engagement
What are the two main planning documents auditors must develop?
- Overall audit security
- Audit Plan
What factors are considered when developing the overall audit strategy?
- Engagement characteristics
- Reporting objectives
- Audit team direction and supervision
- Results of preliminary activities
- Nature, timing, and extent of resources needed
What must the audit strategy and plan be during the audit?
They must be updated and changed as necessary
What is the purpose of audit documentation?
To provide evidence of audit work performed and support the audit opinion
What should audit documentation include?
- Who performed the work and date
- Who reviewed the work and date
- significant matters and professional judgements
- conclusions reached
How long must audit documentation be retained?
usually at least 7 years, depending on firm policy and legal requirements
What are current Audit files and Permanent audit files?
Current: documents related to the current years audit
Permanent: documents of continuing importance
What has ultimate responsibility in a group audit?
The group engagement partner
What are the key considerations in group audits?
- Ethical requirements
- Competence of component auditors
- Planning strategy for group and components
Materiality set for group and components
What auditors must assess regarding component auditors?
- Their competence
- Their independence
- The regulatory environment they operate under
