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As per ISA 300 Planning, the auditor should develop and document an audit program setting out the
nature (what), timing (when) and extent (how much) of planned audit procedures required to implement
the overall audit plan. In preparing the audit programs, the auditor would consider the specific
assessments of inherent (IR) and control risk (CR) and the required level of assurance to be provided by
the substantive procedures. The audit programs should be revised as necessary during the course of the
audit because of changes in conditions or unexpected results of audit procedures. The reason for
significant changes would be recorded.
The following table shows how the acceptable level of detection risk (shaded area) may vary based on
assessments of inherent and control risk.
Auditor's Assessment of control
risk is:
Auditor's
Assessment of
inherent risk is:
High
Medium
Low
High
Lowest
Lower
Low
Medium
Lower
Medium
Higher
Medium
Higher
Highest
Low
Purpose
The purpose of an audit program is to group management assertions in the form of financial statements
into auditor's audit objectives and then link the understanding obtained during the planning phase related
to the financial statement assertions to the assessment of the risk of significant misstatement (ROSM) and
planned audit procedures. It documents:
n
A summary of the audit objectives related to this process and whether the audit objectives are critical
Financial statement assertions that were combined into each audit objective
Planned procedures to gain audit evidence to support ROSM for each audit objective (may also
include results of the procedures)
Planned substantive audit procedures for each audit objective (may also include results of the
procedures).
The enclosed list contains possible suggested audit procedures for different financial statement
components (mostly for the manufacturing concern). All of these procedures will rarely be selected to
minimize the detection risk to an acceptably low level.
The following alphabets have been used to indicate the assertion addressed in a step:
Assertion
Alphabet
Class of
transaction
and events
Account
balances at
period end
Presentation
and
disclosure
Occurrence
Completeness
Accuracy
Cut off
Classification
Existence
Valuation
Allocation
Understandability
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(a)
Client:
Period:
Subject:
S. No.
Assertions
Risk Assessment
IR
1.
3.
4.
OCATL
OCAL
RVU
Audit Procedures
Objective
ALL
6.
S. No.
Test of Controls
1.
ROSM
CA
2.
5.
CR
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
2.
ALL
3.
ALL
4.
CE
5.
6.
N/A
Analytical Procedures
1.
2.
CAL
3.
AU
4.
CEA
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
1.
CEA
2.
3.
Test of Details
4.
5.
(a)
(b)
(b)
(c)
(b)
(c)
CE
CEV
CEV
OAL
Done by
W. P. Ref.
S. No.
6.
7.
Audit Procedures
To check depreciation expense:
(a)
(b)
(c)
Objective
OCAL
9.
10.
EVR
11.
(a)
(b)
(b)
Done by
W. P. Ref.
S. No.
12.
Audit Procedures
For selected intangible assets disposed-off
during the year: (a)
(b)
Objective
CEV
13.
14.
CEKR
15.
OCV
(b)
17.
18.
19.
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
20.
N/A
21.
OCAL
RVU
Done by
W. P. Ref.
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(d)
Client:
Period:
Subject:
S. No.
Assertions
Risk Assessment
IR
1.
2.
3.
4.
5.
6.
Laws &
Regulation
OCAL
RVU
Audit Procedures
Objective
ALL
Test of Controls
1.
ROSM
CA
S. No.
CR
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
2.
ALL
3.
ALL
4.
CE
5.
EV
6.
7.
(a)
(b)
N/A
Analytical Procedures
1.
Test of Details
CEA
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
1.
CE
2.
3.
(b)
(c)
EVR
4.
CER
5.
VK
(a)
(b)
(b)
6.
7.
EV
Laws etc.
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
8.
9.
10.
11.
(b)
OATE
12.
RU
13.
CE
14.
OCAL
RVU
Done by
W. P. Ref.
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(e)
Client:
Period:
Subject:
S. No.
Assertions
Risk Assessment
IR
1.
2.
3.
4.
5.
OCAL
RVU
Audit Procedures
Objective
ALL
Test of Controls
1.
ROSM
CA
S. No.
CR
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
2.
ALL
3.
ALL
4.
CE
5.
EV
6.
7.
(a)
(b)
N/A
Analytical Procedures
1.
CEA
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
1.
CE
2.
3.
Test of Details
(a)
(b)
EVR
4.
CER
5.
VK
(a)
(b)
6.
EV
7.
8.
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
9.
CE
10.
OCAL
RVU
Done by
W. P. Ref.
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(f)
Client:
Period:
Subject:
S. No.
Assertions
Risk Assessment
IR
1.
CA
2.
3.
OCAL
RVU
4.
5.
Test of Controls
1.
ALL
2.
ALL
CR
ROSM
3.
ALL
4.
CE
5.
6.
N/A
Analytical Procedures
1.
2.
CAL
3.
AU
4.
OAL
5.
CEA
Test of Details
1.
CE
2.
CR
3.
ER
4.
(a)
(b)
(c)
(d)
5.
CO
6.
7.
AC
8.
9.
10.
10.
N/A
11.
OCAL
RVU
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(g) Advances, Deposits, Prepayments & Other
receivables
Client:
Period:
Subject:
S. No.
Assertions
Risk Assessment
IR
1.
2.
3.
4.
CA
5.
Laws &
Regulation
6.
OCAL
RVU
CR
ROSM
S. No.
Audit Procedures
Objective
1.
ALL
2.
ALL
3.
ALL
4.
CE
5.
Test of Controls
6.
N/A
Analytical Procedures
1.
Test of Details
CEA
Done by
W. P. Ref.
S. No.
Audit Procedures
1.
2.
3.
(b)
Objective
CE
EVR
4.
CER
5.
VK
(a)
(b)
(c)
6.
EV
7.
Laws etc.
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
8.
9.
10.
11.
CEV
12.
RU
13.
CE
14.
OCAL
RVU
Done by
W. P. Ref.
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(h)
Trade debts
Client:
Period:
Subject:
S. No.
Trade debts
Audit Objectives
Assertions
Risk Assessment
IR
1.
CA
2.
3.
4.
5.
OCAL
RVU
CR
ROSM
S. No.
Audit Procedures
Objective
1.
ALL
2.
ALL
3.
ALL
4.
CE
5.
Test of Controls
6.
N/A
Analytical Procedures
1.
2.
CAL
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
3.
AU
4.
CEA
Test of Details
1.
CE
2.
EVR
3.
ER
4.
5.
6.
7.
8.
9.
10.
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
11.
12.
N/A
13.
OCAL
RVU
Done by
W. P. Ref.
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(i)
Client:
Period:
Subject:
S. No.
Assertions
Risk Assessment
IR
1.
2.
3.
4.
5.
CA
OCAL
RVU
CR
ROSM
S. No.
Audit Procedures
Objective
1.
ALL
2.
ALL
3.
ALL
4.
ALL
5.
6.
7.
Test of Controls
8.
CE
ECA
N/A
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
1.
AU
2.
CEA
Analytical Procedures
Test of Details
1.
2.
ER
3.
CE
4.
CEA
5.
CA
6.
7.
8.
Done by
W. P. Ref.
S. No.
Audit Procedures
Objective
9.
N/A
10.
OCAL
RVU
Done by
W. P. Ref.
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(a)
Accrued Expenses
Client:
Period:
Subject:
S. No.
Accrued Expenses
Audit Objectives
Assertions
Risk Assessment
IR
S. No.
Existence, Rights
& Obligations
Completeness
Valuation
Presentation &
Disclosure
Audit Procedures
Objective
Test of Controls
Select purchase transactions over the
period under audit and ensure the
following controls have existed during
the period:
Purchase orders are approved at an
appropriate level.
Only authorized
purchases are
made
All purchase
orders are entered
into the records
CR
Done by
ROSM
W. P. Ref.
S. No.
Credit to accrued
expenses represent
goods actually
received
All entries to
Accrued expenses
are authorized
Accrued expenses
are recorded in the
appropriate
amount
Accrued expenses
are recorded at the
appropriate
amount
Accrued expenses
have been booked
at appropriate
amount and
represent valid
claims by third
party
Accrued expenses
are accurately
recorded
Audit Procedures
Done by
Credit Notes
issued are
properly
calculated and
recorded at
appropriate
amount
Analytical Procedures
1.
2.
W. P. Ref.
3.
4.
5.
Test of Details
1.
2.
B.
C.
D.
B.
C.
2.
3.
2.1
2.2
2.3
4.
3.
3.2
B.
4.
3.1
2.
2.
Loss contingencies.
3.
Retirement plans.
4.
5.
6.
Lease obligations.
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(k)
Client:
Period:
Subject:
S. No.
Audit Objectives
Assertions
Risk Assessment
IR
Existence, Rights
& Obligations
Completeness
Valuation
Presentation &
Disclosure
CR
ROSM
S. No.
Audit Procedures
Analytical Procedures
1.
2.
Test of Details
1.
CONFIRM DEBT
A. Obtain a schedule of short term borrowing (including
debt outstanding at the end of the prior year, as well as
any new debt or renewal of debt) showing beginning and
ending balances and borrowings and repayments during
the year, and perform the following:
1.
2.
B.
1.2
Done by
W. P. Ref.
C.
2.
2.
3.
4.
C.
3.
2.
2.2
2.3
4.
B.
C.
7.
1.
2.
3.
4.
5.
6.
2.
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(l)
Surplus on Revaluation
Client:
Period:
Subject:
S. No.
Surplus on Revaluation
Audit Objectives
Assertions
Risk Assessment
IR
S. No.
Existence, Rights
& Obligations
Completeness
Valuation
Presentation &
Disclosure
Audit Procedures
Analytical Procedures
1.
2.
Test of Details
1.
CR
Done by
ROSM
W. P. Ref.
2.
1.
2.
3.
4.
5.
b)
6.
7.
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(a)
Sales
Client:
Period:
Subject:
S. No.
Sales
Audit Procedures
Audit Assertion
Addressed
TEST OF CONTROLS
1
Occurrence
Completeness
Completeness
Completeness
Done by
W. P. Ref.
7.
8.
Occurrence
Completeness
TEST OF DETAILS
1.
3.
4.
5.
Completeness
Occurrence
Valuation
Measurement
Presentation /
Disclosure
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(b)
Cost of Sales
Client:
Period:
Subject:
Cost of Sales
S. No.
Audit Procedures
Audit Assertion
Addressed
TEST OF CONTROLS
1.
ANALYTICAL PROCEDURES
1.
2.
Completeness
Occurrence
Occurrence
Done by
W. P. Ref.
a)
b)
TEST OF DETAILS
1.
Completeness
(ii)
Make a selection of
individual purchases from
the journal.
(iii)
(iv)
3.
Occurrence
Presentation/
Disclosure
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(c)
Admin Expense
Client:
Period:
Subject:
S. No.
Admin Expense
Audit Procedures
Audit Assertion
Addressed
TEST OF CONTROLS
1.
2.
ANALYTICAL PROCEDURES
1.
PL3
Completeness
Performed
by
Reference
major variations.
TEST OF DETAILS
1.
Occurrence
2.
Completeness
3.
Presentation/
4.
Completeness
Measurement
Disclosure
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(d)
Financial Charges
Client:
Period:
Subject:
Financial charges
S. No.
Audit Procedures
Audit Assertion
Addressed
TEST OF CONTROLS
1
2.
3.
ANALYTICAL PROCEDURES
Compare current year with prior year
and budgeted amounts to anyalyse the
variation in the expenses. Inquire and
document the reasons for variation
TEST OF DETAILS
1
Occurrence
Measurement
Completeness
Valuation
Done by
PL 5
W. P. Ref.
Completeness
Presentation/
Disclosure
WP Ref.:
Prepared by:
Date:
Reviewed by
Date
Audit Program
(e)
Other Income
Client:
Period:
Subject:
S. No.
Other Income
Audit Procedures
Audit Assertion
Addressed
TEST OF CONTROLS
1
PL 7
2.
3.
ANALYTICAL PROCEDURES
Compare current year with prior year
and budgeted amounts to anyalyse the
variation in the expenses. Inquire and
document the reasons for variation
TEST OF DETAILS
1
Existence
Valuation and
Measurement
Done by
W. P. Ref.
Valuation &
Measurement
Measurement
Existence
Authorisation;
Authorisation;
Measurement
Presentation &
Disclosure