How to Conduct Audits


An audit is a third-party review of a company's financial information or operational compliance. Publicly held firms must undergo frequent audits to remain compliant with federal reporting agencies. Accounting firms are the primary source of auditors and these firms provide skilled individuals to review a company's financial information. The audit is often similar for companies subjected to these reviews because offering a similar process to each client ensures that no deviation occurs from accounting principles or other standard business practices.

  • Submit an audit proposal to the client. Detail the audit scope and necessary charges for all audit services.

  • Meet with the company's ownership or management to establish a relationship. Create an understanding for the audit timeline, scope, number of auditors and strategy.

  • Develop a written audit plan. The plan should detail the fieldwork operations and information necessary for the client to prepare. Clients must usually prepare and submit information for auditors to review.

  • Conduct the fieldwork phase of the audit. This involves reviewing the client's prepared information, interviewing the company's staff, observing operations and testing internal controls.

  • Make extensive notes of any misstatement or deviation from accounting principles. Review a second sample of information if necessary to determine the depth of accounting errors.

  • Discuss the audit findings with the company's ownership or management. Review all errors and misstatements prior to issuing a final audit opinion.

  • Issue an audit opinion. An unqualified opinion indicates that no errors were present in the client's information. A qualified or adverse opinion details auditor misgivings about the inability to complete the audit or the discovery of material errors.

Tips & Warnings

  • The time devoted to each audit step will certainly vary by client. The number of auditors and audit scope often directly influence this process.

Related Searches


  • "Principles of Auditing & Other Assurance Services"; Ray Whittington, et al.; 2010
Promoted By Zergnet


You May Also Like

  • How to Conduct an I-9 Audit

    It's a good idea for your company to conduct an internal I-9 audit of all of its employee files before the government...

  • How to Perform a Basic Accounting Audit

    Auditing is an interesting engagement that requires alertness of mind and concise application of Generally Accepted Accounting Standard using standard auditing producers.

  • How to Conduct a Safety Audit

    A safety audit is a required check of a premises to assure that it is safe for human occupancy. If you think...

  • How to Conduct a Quality Audit

    Quality audits are an important part of helping small businesses grow and prosper because they provide a way to assess the business's...

  • How to Audit a Supplier

    Quality suppliers are a necessary part of an organization because they provide good and services that you use to serve your customers....

  • How to Conduct a Process Audit

    A process is simply a way of doing something. Most people have the same process for going to work in the morning....

  • How To Design an Audit Checklist

    Audits are conducted by companies, government agencies and accrediting bodies to evaluate if individuals and businesses are meeting desired outcomes, documenting accurately...

  • How to Conduct a Brand Audit

    A brand audit is a comprehensive way of looking at how your value proposition -- reasons customers would buy your products --...

  • Desk Audit Procedures

    A desk audit is an evaluation of a particular position with the civil service to determine whether duties and responsibilities correspond to...

Related Searches

Check It Out

Are You Really Getting A Deal From Discount Stores?

Is DIY in your DNA? Become part of our maker community.
Submit Your Work!