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8/10/2019 Audit Assignment Planning Performance Audit
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PLANNING FOR AN
AUDIT ASSIGNMENT
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Steps in PlanningUnderstanding entity objectives, operations and control structure etc.
Identification of risks composite risk consideration
Risk grading and auditabilityconsiderations
Audit Program on each selected risk Audit criteria and audit steps
Reviews and approvals at appropriatelevels
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Steps in Planning PA
Approval of audit assignment plan
Preparation of an audit assignment plan
Decision to proceed or abandon audit
Preparation of a preliminary survey report
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PSR
Objectives of PSR
To understand the audit entity, determine the objectives andscope of audit and identify Issues of Potential Significance to make an initial assessment whether the audit office should
continue with the audit in question keeping in view theauditability of the entity and possible value addition by audit
In case the FAO is confident about the valueaddition and auditability there will be no need offormal PSR.
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PSR Salient Features
Familiarization with the
Objectives and operations of the entity Expected outputs, outcomes and impact Key internal controls
Define Audit Objectives - extent of audit examination for PAobjectives are normally 3Es , there may be other objectives regardingother Es or relating to other type of audit in case of integrated audit
Determine Audit Scope identifying Issues of Potential Significance
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Considerations for Going Ahead
Existence ofeffectivenessrelated issues
Auditability ofselectedissues
Extent ofvalue addition
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Critical Points in PA Planning
Should be effectiveness related issues incase of PA. Issues relating to economy andefficiency are treated in PA only if auditableeffectiveness related issues are present
IPS related toeach AuditObjective
If devised by the auditor it should have beenagreed by the entity.
Audit Criteriarelated toeach IPS
Reliable and complete data should beavailable to carryout audit tests
Sources ofinformation
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Audit Assignment Plan
When the PSR has been approvedand the decision to continue with theaudit has been taken;
When PSR is not required by virtue ofthe fact that the FAO has detailedknowledge about the audit assignmentor because the AGP has finallydecided to conduct this audit anyway.
This work isundertake
in thefollowing
situations:
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Audit Assignment Plan
The assignment audit plan is amajor tool for controlling,
monitoring and managing the
audit by the seniormanagement.
Accountability of the audit teamis determined with reference tothe assignment audit plan.
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Audit Assignment Plan
assignment plan comprises
audit objectives audit scope audit approach
IPS and related criteria Audit team the budget and scheduling of the audit
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Audit Objectives
The Auditor In-charge should re-visit ???? thePSR, if prepared, and see if the objectives can beadopted as defined at the time of PSR or wouldthey require some modification. In any case, this isthe time to firm up the audit objectives finally.
If the DG decides that the performance auditassignment should focus on certain areas ofcompliance audit or study certain problem areas indetail, the audit objectives should specify thesematters clearly.
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Audit Scope
Audit scope refers to the extent of auditcoverage in terms of
time period, stage of the project of program or organization, the locations and facilities to be included in audit
coverage and any aspect which will not be covered
with reasons for exclusion. Audit scope determines the responsibilityof the audit team in the assignment
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PA Criteria
In performance auditing, the auditors have to laydown audit criteria for each issue of potential
significance.
It is unlike financial auditing where the audit criteriaare determined by standard practices.
In performance auditing, there is no single source ofaudit criteria. The auditors have to undertake a sortof research to determine the benchmarks againstwhich they would assess the performance of the
auditee.
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PA CriteriaIn developing/selecting audit criteria following sources maybe reviewed
Objectives of the organization, project or program Generally accepted management practices Past performance standards Standard operating procedures (SOPs) of the organization Rules and regulations applicable to the organization Sector studies Comparison with similar organizations, projects or programs State-of-the-art studies Academic pronouncements of the profession Performance specifications of manufacturers of an
equipment
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PA Criteria
Good practice inperformance auditingrequires that the audit
criteria be sharedwith the auditee
management and
their agreementobtained at this stageof planning.
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Audit Program
The audit program is a written plan for execution ofan audit assignment.
It consists of audit procedures to be followed duringthe audit execution phase. The audit program is a
guide for systematic fieldwork.
It is, at the same time, an effective tool ofsupervision for ensuring that the auditors followappropriate procedures and the work is completed
according to the planned schedule and in a mannerthat achieves audit objectives.
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Audit Program
Unlike financialauditing, standardready-to-use audit
programs do not existfor performance
auditing. For eachperformance audit
assignment a tailor-made audit programhas to be written.
The Auditor In-chargeis responsible for
developing the auditprogram. The Directorwill review the audit
program and submit itto DG for approval.The field work will
start after approval ofthe audit program by
the DG.
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Program achievements
Program targets arewell identified and
measurable
Reliable andsufficient data is
being generated tomonitor targets
The program shouldachieve its targets as
planned within theestimated time frameand at planned costs
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Waste Collection
Waste should be collected from each waste depot accordingto a collection schedule
The SWM management should locate bins / containers forwaste collection at suitable locations after conducting a studyso that infectious waste is not mixed with other types ofwaste.
Junk shops should be allowed to operate only at designatedareas and after proper licensing.
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Waste Collection
There should be weighbridges for weighingwastes located preferably near the dumpingsites. The weighbridges should be operational
and the staff should maintain record of allwaste weighed on a daily basis.
The cost of collection per ton should beminimum.