Question

An audit plan is a:

A) Detailed plan of analytical procedures and all substantive tests to be performed in the course of the audit.
B) Document that provides an overview of the company and a general plan for the audit work to be accomplished, timing of the work, and other matters of concern to the audit.
C) Generic document that auditing firms have developed to lead the process of the audit through a systematic and logical process.
D) Budget of the time that should be necessary to complete each phase of the audit procedures.

Answer 1

An audit plan is a document that provides a comprehensive overview and general plan for the audit work, timing, and key concerns. It is not merely a detailed list of procedures or a generic template but serves as a strategic guideline for the entire audit process.

Step-by-step explanation:

An audit plan is essentially a roadmap created by auditors to ensure that an audit is conducted efficiently and effectively. It outlines the strategies and detailed steps an auditor will take to perform the audit. Among the options provided:

Option A suggests that the plan consists of a detailed layout of analytical procedures and all substantive tests, which is part of the specific techniques and methods auditors employ.

Option B describes the audit plan as an overview document that sets the scope, timing, and direction for the audit. This also includes understanding the company and identifying key areas of audit focus.

Option C implies that the plan is a generic document used systematically across audits, which may not fully capture the tailored approach necessary for each unique audit engagement.

Therefore, the correct answer is B) Document that provides an overview of the company and a general plan for the audit work to be accomplished, timing of the work, and other matters of concern to the audit. This encompasses the broader scope and objectives of the audit, rather than just the detailed procedures or a generic template used across different audits.