A Detailed Audit Program with Sample Draft for CA Articles Support and Professionals. An audit program consists of an appropriate audit treatment to achieve audit goals.
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A detailed audit program
- An audit program consists of an appropriate audit procedure to accomplish audit goals.
- Audit programs are prepared while preparing the audit.
- Transactions are to be checked in audit with recommendation to the audit assertions.
Audit Assertions
Assertion Questions Completeness Has the transaction been recorded in the accounting records? Measurement Is the transaction taped at the proper value? Event Is the deal recorded as expense in proper year of account? Phases in an Audit
Phase I: Audit Initiation
1. Understanding the Entity and its environment
- The market in which the entity runs and the internal controls implemented; for example for a production Issue the following ought to be considered.
- a) Note the items made.
- b) Narrate the Production procedure.
- c) Short on Delivery system and invoicing technique, PO tracking
- d) Note on Inventory Upkeep and related records of goods sold, made.
- Studying the incorporation paperwork i.e. Collaboration deed, Memorandum and Articles of Association
2. Determine the nature, timing & extent of other audit procedures
3. Guarantee that Auditor’s Visit Letters are gotten and approval responded
4. Verification of opening balances:
Check the present year’s opening balances with the closing balances of audited Financial Declarations of the previous year.
Likewise Examine Pertinent Parts of This post:-
Stage 2 and 3- Audit Program for Vouching and confirmation of Transaction
Stage 4– Audit Program for In depth Analysis of Ledgers
Preparation of Financial Statements and Last Reporting
- The market in which the entity runs and the internal controls implemented; for example for a production Issue the following ought to be considered.
- Tax Audit Applicability
- Prepare Financial Statements based on the last information acquired from the customer.
- Prepare Ratio Analysis along-with the possible reasons from management for product discrepancies.
- Preparing the Draft Calculation of Income.
Following should constantly belong of your audit file
- Copy of the audited PLBS of the previous year
- Letter of Appointment.
- Summary of Audit Visits
- Hard Copy of all the tables made throughout the audit go to in the kind defined
- Copies of the quarterly bank declarations
- Any working papers prepared on behalf of the customer
- Copies of recognitions of TDS returns
- Copies of recognitions of BARREL returns
- Hard copies of ledger accounts taken during the course of audit
- Any other file obtained throughout the course of Audit.
Audit Sampling
Audit Tasting Needs auditors judgment.
Analytical Sampling
Easy Random Tasting
This approach uses tasting without replacement; that is, once an item has been chosen for testing it is gotten rid of from the population and is exempt to re-selection. An auditor can execute basic random sampling in one of 2 methods: computer system programs or random number tables.
Methodical (Interval) Sampling
This technique provides for the choice of sample products in such a way that there is a consistent period in between each sample product. Under this method of sampling, every “Nth” item is selected with a random start. Example every 4th product
Stratified (Cluster) Tasting
This approach offers the selection of sample products by breaking the population down into strata, or clusters. Each strata is then dealt with separately. For this strategy to be reliable, dispersion within clusters must be greater than dispersion among clusters. An example of cluster sampling is the inclusion in the sample of all remittances or money dispensations for a specific month.
Suggested Articles
- Basic Principles and Golden Rules of Accounting
- Types of Accounts
- Accounting Standard 13
- What Is Debit Note and Credit Note
- Fund Flow Statement
- Accounting Rate of Return
