Question

please use your own words and phrases

what are the importance of audit planning ?

Answer 1

Audit planning is an important aspect of audit. It occurs at the beginning of the audit process so that vital aspects of audit are given due attention and the problems occured in this process are identified. This would ensure proper execution of audit work by means of coordination.

Planning of audit should be implemented in such a way that important areas of audit are identified. In this process sufficient skilled people are employed who can efficiently carry out the process of audit in accordance with standards of auditing.

In order to plan an audit, different aspects of audit are taken into consideration. At the initiation stage, a planning strategy is set up wherein problem areas identification, time required to solve the same and direction in which one should work to solve the same should be developed. In implementing the audit strategy and identifying the crucial areas, risk of audit is eliminated in the first level only.

The plan in detail describes the nature and timing of audit which evades any material misstatement in the financial statements. The audit should also be made in confirmity with other audit procedures and it should be in accordance with audit standards.

Once audit is planned, it is not imperative to assume that there cannot be changes in it in near future. The auditor should not only decide upon the timing, nature and the limit of audit plan but also review the work of the audit members in accordance with the same.

There should also be proper documentation of audit strategies and audit plan which should also include any modifications at any stage of the process. Standard or tailor made documentations can be referred to in making such documentations.