Beginning the audit process

audit process ppt

Interviews with key employees may take place to investigate business procedures and practices. They also aim to detect opportunities for improvement in the audit process.

If there are any remaining issues, they're resolved at this point. In this context, or through the use of an agile, intuitive BPMN tool that automatically manages documentation which can be a great help, both for the audits and the auditors.

Internal controls are evaluated to make sure they're adequate. Pre-Engagement Activities in Auditing Prior to actually beginning an audit, there are several important steps.

Auditors also need to identify the key areas of inquiry and concern and the specific information they wish to examine in order to analyze those areas.

Materiality is a flexible concept that is the subject of much academic research and professional best practices, but it is basically a function of assets or income that would impact the decision-making of a user of financial statements.

Audit process flowchart

Scheduling an Open Meeting Senior management and key administrative staff are then invited to an open meeting during which the scope of the audit is presented by the auditor. One of the objectives of the audit process is to verify that all company processes are aligned with this strategic vision and that they deliver the value that internal customers need and external ones want. The auditor should also conduct a thorough risk assessment, taking into account the industry of the client, the integrity of management, its corporate governance policies, and its system of internal controls. Requesting Financial Documents After notifying the organization of the upcoming audit, the auditor typically requests documents listed on an audit preliminary checklist. They also aim to detect opportunities for improvement in the audit process. Planning Process After the notification is sent, the auditor will take some time to plan the audit. A risk workshop may be conducted to identify possible problems. Interviews with key employees may take place to investigate business procedures and practices. The fieldwork may be conducted by a few auditors or a larger team, depending on the size and scope of the audit. A compliance audit is designed to ensure the company is complying with applicable regulations or laws.
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Steps of an Audit Engagement