Substantive Procedures

Question 1

What are Substantive analytical procedures

Answer 1

Audit procedures designed to evaluate financial information through the analysis of reasonable relationships among both financial and non-financial data.

Question 2

What are Test of details?

Answer 2

any substantive procedures that are not substantive analytical procedures.

Question 3

What are the types of substantive procedures

Answer 3

Inspection
Observation 
Inquiry
External Confirmation
Recalculation
Reperformance
Analytical Procedures

Question 4

What needs to be there in an effectively written procedure?

Answer 4

Explain WHAT the risk is related to a particular account and assertion and WHY it is a risk

Design a procedure to address the relevant risk

Clearly explain HOW to perform the procedure

Question 5

How to design an audit procedure

Answer 5

Explain what could be wrong in the financial statements and why.

Obtain a piece of documentation from the client that supports the balance you are looking at (accounts receivable detail, asset valuation, revenue listing, and so on).

Test that documentation by comparing it with support (