Page 52 - CA Final PARAM Digital Book.

QNO Types of Audit Plan Old Course – (N20R)
30.150 TITANIUM CNO-- APSE.140
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Contents of an audit plan.

Answer 1. Audit Plan Development: The auditor should create an audit plan, which is more detailed than the
overall audit strategy. This plan includes the nature, timing, and extent (sample size) of audit procedures to
be performed by the engagement team members.
2A. Plan for Risk Assessment Procedures: Under SA 315, the audit plan should include the nature, timing,
and extent of planned risk assessment procedures. These procedures aim to identify and assess the risks of
material misstatement through understanding the entity and its environment.
2B. Plan for Further Audit Procedures: As per SA 330, the audit plan should also detail the nature, timing,
and extent of planned further audit procedures at the assertion level. These procedures are determined
based on the assessed risks.
2C. Plan for other audit Procedures: The audit plan should include any other planned audit procedures
necessary to ensure that the engagement complies with the Standards on Auditing (SAs).
3. First RAP & then FAP: The planning of risk assessment procedures occurs early in the audit process.
However, the nature, timing, and extent of specific further audit procedures depend on the outcome of
the risk assessment procedures.
4. FAP may or may not be simultaneously: The auditor may begin executing further audit procedures for
some classes of transactions, account balances, and disclosures before planning all remaining further audit
procedures.

QNO Sample Size not decided While making audit Plan New Course – (SM23)
30.160 TITANIUM CNO-- APSE.140
CA. Pradyuman is planning for audit of a listed company headquartered in NOIDA. While doing this
exercise, he has made a list of various procedures intended to be performed by him during the course of
audit. He has further made up his mind to decide about sample size at time of performing various
planned procedures. Is above approach proper?
Answer
SA 300 states that audit plan shall include description about nature, timing and extent of audit procedures.
The extent of audit procedures also includes deciding about sample sizes to be tested for performing audit
procedures. Therefore, the said approach is not proper. Various procedures planned to be undertaken
should also include considerations relating to sample sizes to be tested.

1. SA 300: Reference to SA 300, its full name & its applicable in the given scenario.
2. Concept: As per SA 300
Audit Plan: Should include the nature, timing, and extent of audit procedures.

Extent of Audit procedure: The extent of audit procedures encompasses decisions about sample sizes for
audit procedures.

3. Case Discussion: Discuss Point 3 & 4.
Conclusion: Auditor is not following SA 300 properly. Deciding sample sizes during the execution is not
proper. Procedures should include considerations about sample sizes in advance.

QNO Audit Strategy & Audit Plan Relationship Old Course – (N16E, M22R)
30.300 TITANIUM CNO—APSE.260
Discuss the relationship between overall audit strategy and audit plan.
Answer 1a. Preparation: Generally, Audit strategy is prepared before the audit plan. Audit plan is more detailed
than the audit strategy.
1B. Interrelation: Audit strategy and audit plan are inter-related. Change in one lead to a change in the
other.
2A. Example of Modification (Case: CA. Sam for Hitesh Ltd.): Materiality levels adjusted due to
weaknesses.
in internal controls. Deviation from audit strategy necessary, leading to a change in audit plan.
2B. Consideration: Overall audit strategy & plan should consider materiality. Must relate materiality to
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