Definition: A risk-based audit plan is the audit plan in which audit resources and work are deployed and focused based on a high risks areas or accounts as the result of the risks assessment performed by the auditor. This kind of planning requires the auditor to understand the client’s nature of the business, control the […]
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System based audit approach is quite similar to the risk-based audit approach. This approach required the auditor to understand and assess the effectiveness of the client’s key control system especially the key system related to financial reporting. Once the auditor assesses the effectiveness of the system, auditors’ works then focus on the areas that are
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Definition: Risks based audit approach is one of the well-known audit approaches used by the auditor to perform an audit of financial statements and also used by the internal auditors for their internal audit purpose. The principle of this approach requires the auditor to put their effort into the high risks areas rather than spend
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Definition: Permanent audit files are the files that keep the information used by auditors continuously. That information includes engagement later, client’s M&A, long-term contract or agreement, and board meeting minutes. The auditor must keep the documents or events based on nature and classification. And make sure that all information and documents they obtain from their
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Definition: Current audit files are the files that keep all information related to current year auditing. Those documents include the current year’s financial statements, general ledger, management accounts, and supporting documents. These files also include the documents related to audit planning, audit program, and key internal control of the current year. Current audit files also
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Definition: The Balance sheet audit approach is a kind of audit approach that executes by the auditor in the situation that auditors perform most of their testing on the items in the balance sheet rather than items or transactions in the income statement. An auditor applies the balance sheet audit approach based on the concept
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Definition: Audit working papers refer to the documents prepared by or use by auditors as part of their works. Those documents include summarizing the client’s nature of the business, business process flow, audit program or procedure, documents or information obtained from the client, and audit testing documents. Audit working papers are sometimes referred to as
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Definition: Audit documentation refers to the records or documentation of procedures that auditors performed, the audit evidence that they obtained and the conclusion that makes by them based on the evidence obtained. Audit documentation is sometimes called audit working paper or working paper. Internal control documents that auditor prepare in Ms words, Ms excel or
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What is the analytical review? Analytical review is one of audit technique that used to assess the reasonableness of accounts balance, amounts, and transactions that report in the financial statements. This procedure is not used to confirm the correctness as well as the accuracy of the amount or balance of the account, but it is
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Before making a conclusion and express an audit opinion on the financial statements, the auditor needs to assess whether the audit evidence that they obtain are sufficient and appropriate for them to make a decision or not. Sufficient audit evidence here mainly refers to the number of audit evidence. And the appropriate here refers to
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