Develop Overall Audit Programme

Develop Overall Audit Programme

Developing an overall audit programme is the process of preparing a structured and systematic plan of audit procedures to be performed in order to achieve the audit objectives and support the auditor’s opinion on the financial statements.

Steps in Developing an Overall Audit Programme

1. Understand the Client and Its Environment

• Gain knowledge of the business, industry, and regulatory environment
• Understand the accounting system and internal controls

2. Identify Audit Objectives and Assertions

• Determine what needs to be tested for each account balance, transaction class, and disclosure
• Link audit objectives to relevant management assertions

3. Assess Risks of Material Misstatement

• Identify inherent and control risks
• Decide areas requiring more extensive audit procedures

4. Design Audit Procedures

• Select appropriate audit procedures (inspection, observation, confirmation, recalculation, analytical procedures, etc.)
• Determine the nature, timing, and extent of audit tests

5. Prepare the Audit Programme

• Document audit procedures for each audit area
• Allocate responsibilities to audit staff
• Include time budgets and expected outcomes

6. Review and Revise the Audit Programme

• The audit programme is not static
• Revise it as necessary during the audit due to new findings or changes in risk

Purpose of Developing an Overall Audit Programme

• Ensures a systematic and complete audit approach
• Avoids duplication or omission of audit work
• Facilitates supervision and review
• Provides evidence of proper planning and execution of the audit

Summary

Developing an overall audit programme involves planning and documenting audit procedures based on audit objectives and risk assessment to ensure sufficient and appropriate audit evidence is obtained.