Plan now or pay later
Time spent on planning and project management for individual assurance engagements can help make them more effective. John Ward explains how.
Sufficient time needs to be put into the set up and planning of any engagement to ensure that it an be delivered efficiently and effectively. The widely varying nature of assurance engagements makes this even more important. Planning is the key to ensuring that the fieldwork focusses on the specific needs of the engagement, minimises unnecessary risks and uses methods that provide the necessary quality of conclusion and best return for you and for the report's users.
Consider the engagement
We need to be very clear what the engagement is about;
- Why does management need the report?
- Who are the users?
- How will they use the report?
- Is it reasonable or limited? Attestation or direct?
- Is it assurance over description, process, outcome, whole report or even methodology?
- Is it short form or long form?
All of these questions, and more, matter because they potentially affect the focus of the detailed fieldwork and must be considered when planning.
The same principles apply also if this is a voluntary (non-statutory) audit, because the risks will depend upon the underlying purpose to which the users intend to put the financial results.
We should first think about risk at the subject matter level. This helps to identify risks due to the engagement circumstances that are not detailed matters but that are big picture pieces that might otherwise be missed.
This is an extract from an article in the February 2016 edition of Audit & Beyond, the magazine of the Audit and Assurance Faculty.
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