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Financial Audit

Financial Audit.

Changes in Audit procedures..

A recent trend in audits (spurred on by such accounting scandals as Enron and WorldCom) has been an increased focus on internal control procedures, which aim to ensure the completeness, accuracy and validity of items in the accounts, and restricted access to financial systems. This emphasis on the internal control environment is now a mandatory part of the audit of majority companies.

Stages of Audit :

Phase I Plan and Design an Audit Approach :

Where the auditors gain an idea of the organization and prepares an audit plan to work out how the audit will be done?

What the auditors understand?

Phase II Perform Test of Controls and Substantive Test of Transactions:

 Here the auditor verifies the internal control of the organization and based on that decides whether the organization needs a comprehensive audit or substantive audit.

Phase III Perform Analytical Procedures and Tests of Details of Balances

Phase IV Complete the Audit and Issue an Audit Report

After performing various tests, the auditor finally completes the audit and finally issues an audit report.

An Auditor Performs the various functions of Audit with due diligence and has his own set of responsibilities like: