Page 33 - CA Inter Audit PARAM

CA Ravi Taori
those cases by which auditor can ascertain the reporting objectives of the engagement.
OR
The ascertaining of reporting objectives of engagement helps the auditor to plan timing of different audit
procedures and also nature of communications. Give three instances to explain.
The auditor shall establish an overall audit strategy that sets the scope, timing and direction of the audit,
and that guides the development of the audit plan. One of the factors to be taken into consideration while
establishing audit strategy relates to ascertaining of reporting objectives of engagement to plan the timing
of the audit and the nature of the communications required. Some of the instances are given under:
• The entity’s timetable for reporting
• Organization of meetings to discuss of nature, timing and extent of audit work with management
• Discussion with management regarding the expected type and timing of reports to be issued
including the auditor’s report
• Discussion with management regarding the expected communications on the status of audit work
throughout the engagement.
• Expected nature and timing of communications among engagement team members, including the
nature and timing of team meetings and timing of the review of work performed.

In the given case, working paper highlights that auditor has taken into account expected timelines to plan
the audit and nature of the communications required. Since the working paper relates to the statutory audit
of a company, the ascertaining of reporting objectives of engagement helps the auditor to plan timing of
different audit procedures and also nature of communications.

QNO-- Examples of Matters which Affect Efforts of Audit Team New Course – (M24M)
300.05.50 Bhaskar CNO – SA300.040

The auditor needs to direct efforts of engagement team towards matters that in his professional
judgment are significant. Preliminary identification of material classes of transactions, account balances

and disclosures help auditor in establishing overall audit strategy. More energies need to be devoted to
significant matters to obtain desired outcomes. Give three examples to explain the above situation.
Answer The auditor needs to direct efforts of engagement team towards matters that in his professional judgment
are significant. Preliminary identification of material classes of transactions, account balances and
disclosures help auditor in establishing overall audit strategy. More energies need to be devoted to
significant matters to obtain desired outcomes. Few examples are listed as under: -

➢ Volume of transactions which may determine whether it is more efficient for the auditor to rely
on internal control
➢ Significant industry developments such as changes in industry regulations and new reporting
requirements.
➢ Significant changes in the financial reporting framework, such as changes in accounting standards.
➢ Other significant relevant developments, such as changes in the legal environment affecting the
entity

Overall Audit Strategy -- For Resources Old Course – (SM17/M18M/N18M/M19E/M20R/N21M/M23R)
QNO
300.07 Management New Course—(S24E)
Bhaskar CNO SA300.060
The engagement partner of AST AND ASSOCIATES, firm of Chartered Accountants appointed as auditor of
Fabric India Ltd is considering as to management of key resources to be employed to conduct audit.
Discuss how overall audit strategy would assist the auditor.
OR
The engagement partner of SKC & Co., firm of Chartered Accountants appointed as auditor of Fabric India
Ltd is considering as to management of key resources to be employed to conduct audit. Discuss how

overall audit strategy would assist the auditor.
OR
The auditor T of Hand Fab Ltd is worried as to management of key resources to be employed to conduct
audit. Required How the audit strategy would be helpful to the auditor?
OR
"Overall audit strategy sets the scope, timing and direction of the audit, and guides the development of
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