Question

describe the audit process for a continuing client ( you edited the client in the previous year too) audit all the way til the end of the audit IN DETAIL

Answer 1

Continuing audit of a client is comparatively easy as compared to audit of a new client.

In audit since, the previous audit has been done by same auditor the beginning process should be to check the opening balances.

If opening balances are same as last year's closing balance the next step is to start the audit of this year.

The beginning process is to do vouching. Vouching cannot be done 100% and so sampling should be done. All important vouchers should be properly checked. Also, vouchers should be checked on random basis.

Once vouching is done, further process of scrutiny of taxation part and returns should be checked. Auditor should check whether all taxes have been paid. Proper returns have been filed. In case of any defaults the same should be rectified.

The next is to check all the accounts and balances. Debtor and creditor balance confirmation should be obtained to verify the balances.

Finally auditor should check for any frauds committed by anyone which hampers the image or goodwill of funds of the company. The same should be brought to the notice of management and the shareholders.

The process of audit remains the same more or less even if the client has not been audited in previous years.

However, having audited in previous year the auditor has obtained the understanding of the business of the client. This helps in conducting audit in the better way.

After all checking, vouching and verification has been done audit reports should be drafted and financial should be prepared.

All, the points which remain unsolved should be made known to shareholders. Audit report should contain all such points with proper explanations.

Once financial and audit report is prepared, the audit is completed from auditors end. Such report is then presented to management and the shareholders.

Conducting audit of previous known client is comparatively easy and can be done in a better way.

The audit process remains the same. In this way detailed audit can be conducted round the clock with known client.

This will not only keeping transparency with management but also with shareholders.