Chapters 7-9 Flashcards
6 reasons why it is important to plan an audit
to ensure appropriate attention is devoted to important areas
to identify potential problems
to ensure audit work is organised
to enable appropriate audit staff to be selected
to facilitate the direction, supervision and review of the audit
to co-ordinate work done by other experts and auditors
definition of audit strategy
the overal audit strategy sets the scope, timing, and direction of the audit and guides the development of the more detailed audit plan
definition of audit plan
the audit plan converts the more detailed audit strategy and includes the timing and nature of tasks performed by the engagement team
3 things included in audit plan
description of nature, timing and extent of planned risk assessment procedures
description of nature, timing and extent of further audit procedures
other planned audit procedures
when are interim audit visits carried out
during the period of review
when are final audit visits carried out
after the year end
2 things interim audits tend to focus on
risk assessment
documenting and testing internal controls
definition of audit documentation
the record of audit procedures performed, relevant audit evidence obtained, and conclusions the auditord have reached
7 reasons to keep audit documentation
provide evidence on the basis of the auditors conclusion
provide evidence the audit was planned
assist management team to plan and perform audit
to enable the audit team to be accountable
to assist team members to direct, supervise and review
retain a record of matters of continuing significance
enable quality control reviews
3 examples of permenant audit files
engagement letters
legal documents such as a lease
PY signed FS
3 examples of current audit files
accounts checklist
review notes
time budgets
definition of audit evidence
all the information used by the auditor in arriving at the conclusions on which the auditors evidence is based.
4 words audit evidence must be
relevant
appropriate
sufficient
reliable
what are FS assertions
representations by management, explicit or otherwise, that are embodied in the FS
What is a management expert
an individual or organisation possessing expertise in a field other than auditing or accounting
