The Audit Process

Simplifying the audit journey in simple steps, helping you understand the process and feel prepared.

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Key Activities: Identify internal audit lead, gather necessary financial records, review past audit findings (if applicable).

Purpose: Ensures the business is organised and prepared for an efficient audit.

Key Activities: Formal engagement process where the auditor is appointed, objectives and scope are set, and fees are agreed.

Purpose: Defines the audit’s objectives, scope, and expectations between the company and the auditor.

Key Activities: Auditor assesses areas of high financial risk within the company, including industry-specific risks and potential fraud risks.

Purpose: Helps the auditor focus on high-risk areas to enhance audit effectiveness.

Key Activities: Auditor develops a detailed audit plan outlining audit procedures, timelines, and resource allocation.

Purpose: Ensures that the audit process is well-structured, efficient, and in line with regulatory requirements.

Key Activities: Auditor conducts tests on financial records, internal controls, and supporting documents, usually including:

  • Transaction testing
  • Verification of balances
  • Review of contracts and records

Purpose: Gathers evidence to verify the accuracy and completeness of financial statements.

Key Activities: Auditor analyses results from testing, compares to expectations, and identifies any discrepancies or issues.

Purpose: Determines if any adjustments or further explanations are required from the company.

Key Activities: Auditor meets with management to discuss preliminary findings, allowing the company to clarify any identified issues or make adjustments.

Purpose: Provides an opportunity for collaboration and transparency before finalising the audit.

Key Activities: Company makes any necessary adjustments based on audit findings; auditor reviews the final statements.

Purpose: Ensures that the financial statements reflect accurate and compliant financial information.

Key Activities: Auditor drafts a formal report, providing an audit opinion on the financial statements (e.g., unqualified, qualified).

Purpose: Concludes the audit with a clear, documented opinion on the accuracy of financial statements.

Key Activities: Auditor submits the report to company management or stakeholders. The report may also be presented to the board or external stakeholders if required.

Purpose: Ensures transparency and allows stakeholders to make informed decisions based on reliable financial information.

Audit Process