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An audit is a formal process of review by an independent third party. Audit management refers to the overall process or system used to identify the scope of the audit, assign appropriate resources, create the audit checklist and review all the evidence-gathering documentation. The most common type of audit is a financial audit, during which the details of financial transactions are researched and validated for accuracy and completeness. An audit can be conducted on any process or system where there is an established process or policy in place. The actual transactions or data are compared to the policy to determine the level of compliance.
The audit management process is the primary responsibility of the senior auditor or auditing department head. He or she is assigned a person or internal department that has been selected for audit. In many organizations, the senior auditors meet on a regular basis to review upcoming projects and audit engagements and determine how the work will be divided.
The senior auditor meets with the client, reviews his or her objectives and creates the audit scope. This document clearly identifies the areas of review, the expected time frame, resource allocations at a high level and the access required. For example, in a financial audit, the scope is limited to financial transactions that are included or have bearing on the financial statements. Health and safety compliance typically is excluded.
The next stage in audit management is to review the work that must be completed, timeliness, conflicting assignments and staff availability. In most cases, there is an audit technician and one or two auditors who will report directly to the senior auditor. He or she will create an audit plan and assign different tasks to staff members at the appropriate levels.
An audit checklist is an audit management tool created as part of the audit plan. This document is managed by the senior auditor and updated as tasks are assigned, started, completed, reviewed and finalized. The size of the checklist can vary, depending on the audit scope, but usually has a minimum of 25 items to be completed.
A central component of audit management is process control. As each item on the audit checklist is completed, the team member provides the senior auditor with a package of evidence, tests, conclusions and a summary report. These documents form the basis of the audit file and are used to support any statements or conclusions that are included in the final audit opinion.
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