Your project lead has asked you to determine if PVSS has ever conducted an audit
ID: 386812 • Letter: Y
Question
Your project lead has asked you to determine if PVSS has ever conducted an audit. After further investigation of the situation, you determine that this will be the first review that PVSS has conducted or to which it has been subjected. Your project lead has asked you to summarize your review and next steps.
In an e-mail of 2–3 pages to your project lead, complete the following:
Explain what steps you will need to develop and establish to facilitate a successful audit.
List and describe the steps and tasks required to implement an audit program.
In addition, describe the audit class(es) that would be applicable to your contracted audit.
Describe which information systems would be considered part of the scope for the audit.
Explanation / Answer
Hi,
This mail is regarding the upcoming audit that PVSS is going to conduct. Considering the fact that this is the first time firm is going to conduct an audit there are certain things which one needs to take care while carrying out audit. I am going to highlight 7 points which will help you in smoothening out any abnormality you might face during or even after the audits.
1. Advance planning.
Devote additional time both prior to and in connection with year-end close to adequately prepare for the audit, to be available during audit fieldwork, and to communicate with those involved in the audit process. Proper planning and clear expectations will help minimize anxiety and frustration. To be ahead of the curve, treat audit preparation as a year-long process. By keeping schedules and reconciliations up-to-date throughout the year, you can reduce the time it takes to prepare for the audit at the end of the year.This will minimize surprises and allow the organization to make appropriate plans or necessary changes.
2.Awareness regarding change in activities
Did the organization start a new program or receive a new grant? Are there any new reporting requirements? Were any activities discontinued, or were there any impairments? Were there significant changes in internal control systems? Such changes in activities may trigger accounting and reporting considerations that should be communicated to the auditor during the planning process.
3.Learning from past
It is important to take stock of any prior year audit adjustments, internal control recommendations, or struggles encountered during prior audits. These can be a starting point for self-review and a memory-jogger to insure these issues are not repeated.
4.Develop timeline and assign responsibility.
Review the list of workpapers and assign each item from the list to a responsible person and include a due date. Make sure to allow adequate time for review and correction of schedules if necessary. Tackle the most difficult, complex, or time-consuming areas first when possible.
5.Organize data.
Create a repository of audit schedules that can be accessed in future years by the appropriate personnel. Creating subfolders for significant transaction cycles or categories, such as expenses and payables, investments, fixed assets, debt, etc. to make it easier to manage and retrieve schedules
6.Perform a self-review.
Plan review schedules and workpapers to ensure agreement on observation. Take a step back and assess the overall financial statements for reasonableness. Also read and update the notes to your financial statements.
7. Be available during fieldwork.
Avoid key personnel scheduling time off during the audit, and consider rescheduling or postponing non-critical meetings for finance and accounting staff heavily involved with the audit. Although most of the schedules and workpapers will have been requested by the auditors prior to the start of audit fieldwork, understand that the auditors will be asking for additional information, including supporting documents and explanations
I hope taking care of these points will help you in enhancing your learning and performing your job with perfection.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.