Auditing

Application of the audit process to different accounting cycles.

Auditing refers to a systematic and independent examination of books , accounts, documents and vouchers of an organization to ascertain how far the financial statements present a true and fair view of the concern .it also attempts to ensure that the books of accounts are properly maintained by the concern as required by law. Auditing has become such an ubiquitous phenomenon in the corporate and the public sector that academics started identifying an “audit society “ . the auditor perceives and recognizes the propositions before him or her for examination , obtains evidence , evaluates the same and formulates an opinion on the basis of his judgment which is communicated through his audit report (1).

The audit process is generally a ten-step procedures.

1. Notification.

2. Planning.

3. Opening meeting.

4. Fieldwork.

5. Communication.

6. Report drafting.

7. Management response.

8. Closing meeting.

9. Report distribution.

10. Follow up.

Notification:

First, you will receive a letter to inform you of an upcoming audit. The auditor will send you a preliminary checklist. This is a list of documents (e.g. organization charts, financial statements) that will help the auditor learn about your unit before planning the audit.

Planning:

After reviewing the information, the auditor will plan the review, conduct an engagement risk assessment, draft an audit plan, and schedule an opening meeting.

Opening meeting:

The opening meeting should include senior management and any administrative staff that may be involved in the audit. During this meeting, the scope of the audit will be discussed. You should feel free to ask the auditors to review areas that you are concerned about. The time frame of the audit will be determined, and you should discuss any potential timing issues (e.g. vacations, deadlines) that could impact the audit. It doesn't take as much of your time as you might...