The basic process of auditing

The basic process of auditing is as follows:

The five phases of the auditing process include planning, evaluating, testing, reporting, and tracking. The purpose is to identify and improve the organization's internal controls as well as to monitor the organization's financial reporting compliance, accuracy and transparency.

I. Planning

1, the audit planning stage refers to the formal commencement of the audit work before the auditor needs to investigate and analyze the auditee to determine the nature of the audit task, scope and timeframe, and the preparation of the corresponding audit plan and arrangements for implementation.

2, specifically, the audit plan needs to consider the auditee's various risk factors and focus on the direction of verification, as well as the balance of audit costs, personnel, time and other constraints.

Two, evaluation

1, in the audit evaluation stage, the auditor needs to evaluate the internal control system of the auditee, so as to determine the degree of audit risk.

2. Specifically, the auditor evaluates the auditee's financial management system, accounting system, internal control operating procedures, and segregation of duties, and prepares a program of follow-up audit tests based on these evaluations.

3. Testing

1. Audit testing is the core aspect of auditing, which is mainly to verify whether the auditee's financial reports are true, accurate and transparent by checking, verifying and comparing the selected samples.

2, according to the specific audit objectives and testing program, the auditor can take a number of different forms of testing methods, such as physical inspection, evidence inspection, calculation and analysis, comparison and confirmation.

Four, report

1, the audit report is one of the results of the audit, but also the auditor finally to the auditee and relevant stakeholders to provide advice and recommendations.

2, in the preparation of the audit report, the auditor needs to internal control deficiencies, financial statement errors, irregularities and other important issues identified in the audit process to be clear, objective and accurate description, and combined with the relevant evidence and results, the corresponding conclusions and recommendations.

V. Tracking

1. In the audit tracking stage, the auditor needs to follow up and urge the auditee to correct the problems identified in the audit process, and evaluate and confirm the corrective measures taken.

2. In addition, the auditor needs to track changes in relevant laws and regulations and regulatory bodies, and make timely adjustments to the audit strategy and methodology to ensure the accuracy and effectiveness of the audit results.