...Audit Process Planning The auditor will review any prior audits in your area and professional literature. The auditor will research applicable policies and statutes and prepare a basic audit program to follow. Notification The auditor will notify the appropriate department or departmental personnel regarding the upcoming audit and its purpose, at which time an entrance conference will be scheduled. Entrance Conference The entrance conference will include management and any administrative personnel involved in the audit. The audit's purpose and objectives will be discussed as well as the audit program. The audit program may be adjusted based on the information obtained during this meeting. Preliminary Work and Planning The audit program is further developed using knowledge and information obtained during this process. The auditor will gain an understanding of the operation from responses from the internal control questionnaire, interviews with key personnel, and walk-throughs of key processes. Based on this initial assessment of risks and controls, tests to determine whether controls are operating effectively will be developed. Fieldwork This step includes the testing to be performed as well as follow-up interviews with appropriate department personnel as necessary. Report Drafting After the fieldwork is completed, a report is drafted. The report includes such areas as the objective and scope of the audit, relevant background, and the findings and recommendations...
Words: 371 - Pages: 2
...Audit Process Letter Laura Sferra ACC/546 November 23, 2015 Allen Foster Mrs. Susan Right Senior Partner Anderson, Olds, and Watershed 1 Shoe Street New York, NY. 90001 Dear Mrs. Right, Mr. Lancaster, President of Apollo Shoes, has expressed his satisfaction with the services that our firm offers and would like to continue with a full audit. Because our client does not want our firm to talk to the predecessor auditor, I recommend accepting a prospective engagement after I perform an investigation by gathering information about our client's reputation and background. Client acceptance and continuance procedures are the foundation of the risk assessment process (SAS No. 8). Upon acceptance of our client, I am confident that we will be able to move forward under the AICPA auditing standards to determine that the financial reporting framework is appropriate. My objective is to plan the audit so that it is conducted efficiently and effectively, in accordance with Generally Accepted Auditing Standards. I will take into consideration the preliminary planning activities such as the client acceptance, ethical position of our audit firm and our understanding of the entity and its environment, including its internal control, to develop an effective and efficient overall audit strategy that will appropriately respond to assessed risks. Our engagement letter, will include the timetable of fieldwork, the scope and duration of...
Words: 1378 - Pages: 6
...Anderson, Olds, & Watershed, CPAs August 13, 2012 Larry Lancaster Apollo Shoes, President 444 Primrose St New York, New York 12345 Dear Mr. Lancaster: Greetings! This letter is to confirm our understanding of our engagement of the approaching auditing process for Apollo Shoes, Inc. Our firm is delighted to carry on the work with Apollo Shoes, Inc. and complete the assessment for the year ending on December 31, 2011. Our team associates would like to attest the audit objectives, terms, limitations, and various services provided for this engagement. Our services will include auditing financial statements such as income statement, balance sheets, statement of retained earnings, and the statement of cash flows. The financial audits will make sure that financial statements are in accordance to General Accepted Accounting Principles (GAAP). As we all know, investors, creditors, managers, and government agencies use these statements. Additionally, our team checks and evaluate the operational performance by learning particular areas of the organization, its significance and effectiveness. Anderson, Olds, & Watershed will provide sensible, but not complete, assurance services that are being carry out by professional auditors to enhance the reliability of internal controls, IT systems, financial statements, compliance with regulation, and human resources practices. Our auditors...
Words: 1019 - Pages: 5
...Beginning Audit Process Anderson, Olds, & Watershed, CPAs August 13, 2012 Larry Lancaster Apollo Shoes, President 444 Primrose St New York, New York 12345 Dear Mr. Lancaster: Greetings! This letter is to confirm our understanding of our engagement of the approaching auditing process for Apollo Shoes, Inc. Our firm is delighted to carry on the work with Apollo Shoes, Inc. and complete the assessment for the year ending on December 31, 2011. Our team associates would like to attest the audit objectives, terms, limitations, and various services provided for this engagement. Our services will include auditing financial statements such as income statement, balance sheets, statement of retained earnings, and the statement of cash flows. The financial audits will make sure that financial statements are in accordance to General Accepted Accounting Principles (GAAP). As we all know, investors, creditors, managers, and government agencies use these statements. Additionally, our team checks and evaluate the operational performance by learning particular areas of the organization, its significance and effectiveness. Anderson, Olds, & Watershed will provide sensible, but not complete, assurance services that are being carry out by professional auditors to enhance the reliability of internal controls, IT systems, financial statements, compliance with regulation, and...
Words: 279 - Pages: 2
...Contents Executive Summary 4 Introduction 5 The OHSAS 18001 standard: A literature review 5 The audit process: challenges and some propositions for improvement 6 Challenges 6 Propositions for improvement 7 Conclusion 8 Bibliography 9 Executive Summary This report is prepared to provide a brief description about the audit process of OHSAS 18001, which is a framework to effectively manage the Occupational health and safety policies including compliance with the legislation that applies to organization’s activities and identified hazards. As defined the objective of the standard is to have a clear management structure with defined authority and responsibility, clear objectives for improvement, with measurable results and a structured approach to risk assessment (Montero, Araque, and Rey, 2009).This also includes the monitoring of health and safety management failures, auditing of performance and review of policies and objectives according to the standard. In my previous organization in Bangladesh, we have started working towards qualifying for the OHSAS 18001 certificate and I was responsible as an internal auditor for the process. In this process, I also had the opportunity to work with the external auditor (certification audit). In the auditing process, I have monitored health and safety management failures, auditing of performance and managed to review of policies and objectives as suggested by the external auditor. In this report, some brief discussion...
Words: 1654 - Pages: 7
...INTRODUCTION A financial audit, or more accurately, an audit of financial statements, is the verification of the financial statements of a legal entity, with a view to express an audit opinion. The audit opinion is intended to provide reasonable assurance that the financial statements are presented fairly, in all material respects, and/or give a true and fair view in accordance with the financial reporting framework. The purpose of an audit is to enhance the degree of confidence of intended users in the financial statements. The general definition of an audit is an evaluation of a person, organization, system, process, enterprise, project or product. The term most commonly refers to audits in accounting, but similar concepts also exist in project management, quality management, and energy conservation. Financial audits are typically performed by firms of practising accountants who are experts in financial reporting. The financial audit is one of many assurance functions provided by accounting firms. Many organizations separately employ or hire internal auditors, who do not attest to financial reports but focus mainly on the internal controls of the organization. External auditors may choose to place limited reliance on the work of internal auditors. Internationally, the International Standards on Auditing (ISA) issued by the International Auditing and Assurance Standards Board (IAASB) is considered as the benchmark for audit process. Almost all jurisdictions require auditors...
Words: 7789 - Pages: 32
...Kudler’s Audit Processes Kudler Fine Food has expanded business and updated their computer systems to meet demands. As IT information is adopted within the organization, automation control processes has become more virtualized. To ensure that Kudler’s computerize systems function properly an audit must be performed on an annual basis. Management at Kudler Fine Foods wants to see the proposed audit schedules for all systems. Management wants to know the types of audit and how they will be conducted. In addition, management would like to know about events that might prevent reliance on auditing through the computer. Types of Audit Information technology and financial audits primary objectives are to ensure data integrity, safety, secure and operational effectiveness for Kudler’s business processes. Internal audit will provide an opinion on the accuracy and fairness of the financial statements. “This fairness evaluation is conducted in the context of generally accepted accounting principles (GAAP) and requires application of generalized auditing standards” (Bargranoff, 2008). External audits will assess computer-base accounting systems. The purpose of the audit is to determine how the computerized system impacts Kudler’s financial statements. Substantive test will be done to ensure proficiency; and it will begin with a preliminary test. A risk assessment will be another objective of the audit. “Risks of material misstatement can arise from a variety of sources, including external...
Words: 909 - Pages: 4
...Relationship between Internal Controls and the Audit Process Internal controls are the policies, practices, procedures, and processes that management implements in order to ensure the accuracy and fairness of the information recorded in company financial statements. Traditional management practice has been to define a performance expectation and monitor employee performance for deviations from established performance standards. Traditional auditing has also followed this management practice with regard to internal controls. Auditing traditionally has involved reviewing and testing established policies, practices, procedures, and processes for evidence of non-compliance. The result of this type of auditing is that the auditor effectively becomes the internal control cop. Although the auditor may be effective at finding deviations from the current internal control scheme, the auditor provides little value beyond that to the client. Modern management philosophy deviates from the traditional philosophy in choosing to focus on the positive of the employee relationship by inspiring employees to greater heights rather than setting a bar and punishing employees who fail to reach the bar. Auditing is most beneficial to the client when it follows the same path. Attestation where an auditor offers an opinion as to the quality of the existing financial statements is only one area that an auditor performs (Hayes, Dassen, Schilder, & Wallage, 2005). When auditors realize that...
Words: 419 - Pages: 2
...internal audits carried out are carried out in compliance with Internal company standards and procedrues has been assessed by the National Safety Authority (Railway Safety Commission) as part of the submission for safety certification under Commission Regulation 1158/2010. Our internal audit processes meets the requirements of section S of the Common Safety Method Directive (CSM) by demonstrating that there is an auditing system that is • Independent • Impartial and transparent • Planned and revised dependant on results of previous audits • Procedures are in place for competent auditors • Management of recommendations and communications of findings to persons who have accountability to implement findings. This requirement is not dissimilar to the obligations imposed on UK railway undertakings under Schedule 1 (k) of the Railways and Other Guided Transport Systems (Safety) Regulations 2006 (ROGS). However from July 2013 the CSM for monitoring will require more defined processed for monitoring to enable effective management of safety in the railway The risk is that without audit structures which define the role, purpose and processes of auditing, the benefits of auditing and the potential outcomes of not carrying out diligent audits is not understood by the management team. This paper will attempt to clarify the role, purpose and processes involved in auditing its value to the organisation if carried out to appropriate and transparent standards. The Role of the Audit The...
Words: 2172 - Pages: 9
...Introduction In preparation for an accreditation audit, I will discuss the current communication compliance status of the organization based on the Nightingale Community Hospital’s previous Joint Commission Survey. A corrective action plan will be submitted to ensure compliance with the Joint Commission along with a brief summary on why a communication review is important to the hospital. Body A. In reviewing the Joint Commission (TJC) survey results on Nightingale Community Hospital from 2 years prior, communication was cited on a direct finding relating to a Leadership Standard (Joint Commission Perspectives, 2013). Further review indicates that miscommunication is associated to the other 5 findings, as well. Noguchi (2013) discusses medical errors resulting from miscommunication, adding that medical errors may rank as the third leading cause of death in America. For the purpose of this executive summary, the focus will remain on Leadership standard LD.04.01.05 and its direct finding that hospital leaders did not effectively communicate a functional screening criteria policy to staff nurses. Nightingale Community Hospital (NCH) currently utilizes a pre-procedure hand-off form and site identification and verification process/policy to ensure that correct patient, site, and procedure is completed in surgery. The pre-procedural hand-off is a detailed checklist that aids the nurses from hand-off to accepting patient prior to a procedure. Although detailed, several key...
Words: 1884 - Pages: 8
...Head: THE PROCESS AND PREVENTING THE RISK OF A TAX AUDIT 1 The Process and Preventing the Risk of a Tax Audit By Marivic Engquist National American University August 12, 2012 THE PROCESS AND PREVENTING THE RISK OF A TAX AUDIT 2 Abstract This paper illustrates how an Internal Revenue Service (IRS) audit strikes fears in individuals, small businesses and large corporations. By understanding the process of a tax audit and reporting information that is understandable, people can lesson some of the risk. According to Sidney Weisman, an attorney and senior editor with the Research Institute of America, publisher of tax materials for professionals, “the easiest way to survive a tax examination is to prepare for one at the time you fill out the tax return” (Rankin, 1981, p. 2.29). THE PROCESS AND PREVENTING THE RISK OF A TAX AUDIT 3 The Process of Lessoning the Risk of a Tax Audit The tax audit have been feared by many and embraced by the few. Even though there are ways to reduce the likelihood of an audit, one must understand how the audit process works. If selected, a tax audit usually means corresponding with the IRS, searching through files, and producing records. It can also mean paying additional taxes, interest, or a penalty. Reducing the likelihood of an audit, all income...
Words: 2563 - Pages: 11
...5 2.1 Purpose 5 2.2 Scope 5 2.2.1 In Scope 5 2.2.2 Out of Scope 5 2.3 Assumptions 6 2.4 Reference 7 2.5 Functional Description – Reversal-Correction Process 8 2.5.1 Functional Overview 8 2.5.1.1 Current State Data Flow Diagrams 8 2.5.1.2 Future State Data Flow Diagrams 12 2.6 Related Application Requirements 19 2.7 Key Considerations 20 2.8 Source System Inputs 21 2.9 FDS/ODS Inputs 21 2.10 FDS/ODS Outputs 22 2.11 Logical Data Model Diagram – N/A 22 2.11.1 Table Definitions 22 2.12 Technical Description 25 2.13 Processing Logic 25 2.13.1 Functional Process Flow 25 2.13.2 Process 01 – Identification 29 2.13.2.1 Inputs 29 2.13.2.2 Outputs 29 2.13.2.3 Potential temporary/staging table definition 30 2.13.2.4 Processing Steps 31 2.13.2.5 Mapping document 31 2.13.3 Process 02 – Reversal 32 2.13.3.1 Inputs 32 2.13.3.2 Outputs 32 2.13.3.3 Potential temporary/staging table definition 34 2.13.3.4 Processing Steps 34 2.13.3.5 Mapping document 35 2.13.4 Process 03 – Delete 35 2.13.4.1 Inputs 35 2.13.4.2 Outputs 36 2.13.4.3 Potential temporary/staging table definition 37 2.13.4.4 Processing Steps 37 2.13.4.5 Mapping document 37 2.13.5 Process 04 – Correction 38 2.13.5.1 Inputs 38 2.13.5.2 Outputs 39 2.13.5.3 Potential temporary/staging table definition 40 2.13.5.4 Processing Steps 40 ...
Words: 9695 - Pages: 39
...TOTAL QUALITY MANAGEMENT PRACTICE IN SMALL AUDIT FIRMS IN NIGERIA CHAPTER ONE INTRODUCTION 1.1 Background of the study Total quality management (TQM) practices in small audit firms have had accounting antecedence. The concept can be traced back to early 1920 production control idea notably, the concept developed in the late 1940’s and 1950’s, pioneered by American Feigenbaum, Deming and Juran. The concept total quality management (QTM) has many definitions. The gurus of total quality management discipline like Deming, Juran, Crosby, Ishikawa and Feigenbaum defined the concept in different ways, but still the essence and spirit remained the same. According to Deming, quality is a continuous improvement process towards predictable degree of uniformity and dependability. He identified fourteen principles of quality management to improve productivity and performance of an organization. Juran defined quality as “fitness for use”. According to him, every person in an organization must be involved in the effort to make products or services that are fit for use. Crosbly defines quality as conformance to requirement. His focus was on zero defects and doing it right the first time. Ishikawa also emphasized importance of total quality control to improve organizational performance. According to him, quality does not only mean the quality of products but also of after sale services, quality of managing the company itself and the human life. Feigenbaum defined total quality management...
Words: 8701 - Pages: 35
...An HR audit is like an annual health check, says EJ Sarma. It plays a vital role in instilling a sense of confidence in the management and the HR functions of an organisation A healthy HR function in an organisation is as important as the physical and mental well being of a human body. Typically the basic reason why organisations prefer to conduct an HR audit is to get a clear judgement about the overall status of the organisation and also to find out whether certain systems put in place are yielding any results. HR audit also helps companies to figure out any gaps or lapses and the reason for the same. Since every company plans certain systems and targets, an HR audit compares the plans to actual implementation. The concept of HR audit has emerged from the practice of yearly finance and accounting audit, which is mandatory for every company, to be done by external statutory auditors. This audit serves as an examination on a sample basis of practices and systems for identifying problems and ensuring that sound accounting principles are followed. Similarly, an HR audit serves as a means through which an organisation can measure the health of its human resource function. Organisations undertake HR audits for many reasons: 1 To ensure effective utilisation of human resources. 2 To review compliance with tons of laws and regulations. 3 To instill a sense of confidence in the human resource department that it is well-managed and prepared to meet potential challenges and opportunities...
Words: 1324 - Pages: 6
...Compliance Audit Report Public Version ExxonMobil Corporation-Baton Rouge NERC ID # NCR00128 Confidential Information (including Privileged and Critical Energy Infrastructure Information) – Has Been Removed Date of Audit: July 17-19, 2012 Date of Report: August 11, 2012 Confidential information (including Privileged and Critical Energy Infrastructure Information) – Has Been Removed TABLE OF CONTENTS Executive Summary ........................................................................................................ 3 Audit Process .................................................................................................................. 3 Objectives ................................................................................................................................................ 3 Scope ....................................................................................................................................................... 4 Confidentiality and Conflict of Interest ................................................................................................ 4 Methodology............................................................................................................................................ 4 Company Profile ..................................................................................................................................... 5 Audit Participants ...............................................
Words: 1830 - Pages: 8
