The aim of audit preparation is to completely comprehend the market and operating environment of the organisation being audited. Audit preparation would also identify and note the company’s major audit risks, effectively giving the auditor a heads up so they can better evaluate the company. Get More Information
Internal controls testing, which is conducted before and after the year-end audit, is another task obligation for Audit Planners. By testing the security of the operating systems and accounting reconciliation, this examines the procedures, controls, and protocols within the company’s infrastructure. Internal control monitoring will not be performed during the audit because the auditor does not expect the internal controls to be accurate systemic approaches. In this situation, the audit takes a’substantive approach,’ which means no internal control monitoring is performed before or during the audit.
In terms of audit risks, the planner will lay out the most significant dangers to the auditor in the event that the auditor issues the incorrect opinion. Sales representatives who overstate their sales figures, resulting in overstated revenue, are one example of these significant risks. This will inform the auditor ahead of time that they will need to improve their process for reviewing the company’s absolute revenue figures in order to conduct an accurate and impartial audit.
Audits assist businesses in determining their financial position at the end of the fiscal year. Other internal audit work, such as information management audits, also show the executive where any issues or major risks are. If issues are discovered during the IT audit, the company executive will hire auditors to figure out how to address them properly and implement new policies and processes to better manage the risks. The protection of the company’s computer systems and the information stored on them is one of the company’s key risk areas. The audit planner will examine the existing procedures and policies in detail and make a list of the apparent risk areas for the IT auditor to review and make adjustments or presentations for system improvement.