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Audit Planning- Assignment

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Added on  2020-03-16

Audit Planning- Assignment

   Added on 2020-03-16

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AUDIT PLANNINGRunning head: audit planning
Audit Planning- Assignment_1
Audit planning 1ContentsAudit Planning.............................................................................................................................................3Analytical Review...................................................................................................................................3Preliminary Judgement of materiality......................................................................................................3Inventory.....................................................................................................................................................4Rationale for selection.............................................................................................................................4Assertion and explanation........................................................................................................................4Recommended audit procedure...............................................................................................................4Accounts Receivables..................................................................................................................................4Rationale for selection.............................................................................................................................4Assertions and explanations....................................................................................................................5Recommend audit procedure...................................................................................................................5Sales............................................................................................................................................................5Rationale for selection.............................................................................................................................5Assertions and explanation......................................................................................................................5Recommended audit procedure...............................................................................................................5Owner’s equity............................................................................................................................................6Rationale for selection.............................................................................................................................6Assertions and explanations....................................................................................................................6Recommended audit procedure...............................................................................................................6Motor vehicles.............................................................................................................................................6Rationale for selection.............................................................................................................................6Assertions and explanations....................................................................................................................6Recommended audit procedure...............................................................................................................7Interest expense...........................................................................................................................................7Rationale for selection.............................................................................................................................7Assertions and explanations....................................................................................................................7Recommended audit procedure...............................................................................................................7Superannuation............................................................................................................................................8Rationale for selection.............................................................................................................................8Assertions and explanations....................................................................................................................8Recommended audit procedure...............................................................................................................8
Audit Planning- Assignment_2
Audit planning 2Comparative income statement....................................................................................................................9Balance sheet.............................................................................................................................................11References.................................................................................................................................................14
Audit Planning- Assignment_3
Audit planning 3Audit PlanningAudit planning is the beginning of the procedure of auditing. It is an auditor’s responsibility toplan audit properly. As the planning include forming the strategies to develop an audit planwhich takes in particular planning the risk assessing procedures and plan the resultants to therisks associated with the material misstatement (Hayes, 2014). Audit planning is the continuousprocess starts after the previous audit ends. The whole plan includes nature, time and extent ofthe procedures to be followed for the assessment of risk and various tests are to be done on theseprocedures and its controls. Auditor makes sure to plan in alignment of the business standards(Knechel, 2016).Analytical Review As it is clear from the name analytical review is a review of extensive ratios and trends in theincome statement and balance sheet. It basically investigates any unusual activity or fluctuationof the items in the said income statement and balance sheet. The dependency an auditor placeson the results of the analytical review based on the facts which includes materiality, control risksand assessment. This review assist auditor in planning the nature and extent of the auditprocedures to improve the effectiveness and reduces the detection risk for some specific financialstatement. The main purpose of analytical review is the review of financial statement in the finalstage overall (Frost, 2017).Preliminary Judgement of materialityIt is one of the major step in applying materiality where judgements are required to be made tothe clients in regard to the materiality. At first auditor establish a preliminary judgement thatwhat base can be chosen and multiplied by the percentage factor in order to determinequantitative judgement which can be further adjusted for qualitative factors about materiality.Secondly the preliminary judgement of materiality is allocated to the classes of transactions andmake possible for auditor to plan the scope of procedures. Lastly the estimation are made formisstatements and being compared to the judgement about materiality (Bahr, 2014).
Audit Planning- Assignment_4

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