Mastering Audit Planning_ Key Factors Revealed

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00:00Welcome back, students.

00:02Today, we're going to explore the factors that affect the reporting objectives,

00:06timing of the audit, and the nature of communications.

00:09Understanding these factors is essential for effective audit planning and execution.

00:14Let's get started.

00:16Several key matters influence the reporting objectives,

00:19timing of the audit, and the nature of communications during an audit engagement.

00:23Let's dive into each of these important elements.

00:26Firstly, the company's timetable for reporting plays a crucial role.

00:30This includes interim and year-end financial reporting deadlines.

00:35Auditors must align their audit schedule with these deadlines to ensure timely reporting.

00:40Secondly, the schedule of meetings with management and those charged with governance,

00:44including the audit committee, is important.

00:47These meetings are essential for discussing the nature, extent, and timing of the audit work.

00:53Thirdly, the expected type and timing of reports to be issued must be considered.

00:58This includes the auditor's report, management letters,

01:01and communications to those charged with governance.

01:04Understanding the reporting requirements helps in planning

01:07and delivering timely and relevant audit outputs.

01:10Fourthly, communication with component auditors, experts, and internal audit is crucial.

01:16This involves coordinating with these parties regarding the expected types

01:20and timing of reports resulting from their work on the audit.

01:23Fifthly, the size, complexity, and number of locations of the client

01:28will affect the timing of visits to the client.

01:31For example, complex manufacturing facilities may require more detailed planning and extended visits.

01:37Lastly, the extent and complexity of computerization at the client

01:42will also impact the timing of visits.

01:44The availability of data and personnel for assistance with computer-assisted audit techniques,

01:49CATS, must be considered to ensure effective use of technology in the audit.

01:54Let's consider an example.

01:56ABC Audit Firm is planning an audit for XYZ Limited.

02:00They start by understanding XYZ Limited's reporting timetable,

02:05including interim and year-end deadlines.

02:08They schedule regular meetings with XYZ Limited's

02:11management and audit committee to discuss audit progress.

02:14They plan the types and timing of reports to be issued,

02:18including the auditor's report and management letters.

02:21They coordinate with component auditors and experts to ensure timely and effective communication.

02:26They consider the size, complexity, and number of locations of XYZ Limited

02:32planning visits accordingly.

02:34They also assess the extent and complexity of computerization

02:37at XYZ Limited and plan for the availability of data and personnel for CATS.

02:42This thorough planning helps ABC Audit Firm ensure a comprehensive and effective audit.

02:48Understanding these matters is critical as it ensures that the

02:51audit is conducted efficiently and effectively.

02:54It helps auditors align their work with the client's reporting requirements

02:58and facilitates clear and timely communication with all parties involved.

03:02To summarize, the key matters affecting reporting objectives,

03:06timing, and communications during an audit engagement are

03:10Company's timetable for reporting 2.

03:13Schedule of meetings with management and those charged with governance 3.

03:17Types and timing of reports to be issued 4.

03:20Communication with component auditors, experts, and internal audit 5.

03:25Size, complexity, and number of locations 6.

03:29Extent and complexity of computerization.

03:32By understanding and addressing these matters,

03:35auditors can ensure a thorough and effective audit.

03:38Thanks for watching!

03:39If you found this video helpful, like, share, and subscribe for more insights.

03:45See you next time!

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