Audit Planning and Control for Huawei Technologies Co. Ltd
Overview
It is common industry knowledge that an audit plan provides the specific guidelines auditors must follow when conducting an external audit. External public accounting firms conduct external audits to ensure outside stakeholders that the company’s financial statements are prepared in accordance with generally accepted accounting principles (GAAP) or International Financial Reporting Standards (IFRS).
Use the Internet to select a public company that appeals to you. You may also use the company dossier in the Nexis Uni database to find company information.
Imagine that you are a senior partner in a public accounting firm hired to complete an audit for the chosen public company.
Instructions
Write a 4–6 page paper in which you:
Outline the critical steps inherent in planning an audit and designing an effective audit program. Based on the type of company selected, provide specific details of the actions that the company should undertake during the planning and designing of the audit program.
Examine at least two performance ratios that you would use in order to determine which analytical tests to perform. Identify the accounts that you would test, and select at least three analytical procedures that you would use in your audit.
Analyze the balance sheet and income statement of the company that you have selected, and outline your method for evidence collection which should include, but not be limited to, the type of evidence to collect and the manner in which you would determine the sufficiency of the evidence.
Discuss the audit risk model and ascertain which sampling or non-sampling techniques you would use in order to establish your preliminary judgment about materiality. Justify your response.
Assuming that the end result is an unqualified audit report, outline the primary responsibilities of the audit firm after it issues the report in question.
least two quality academic resources in this assignment. Note: Wikipedia and other similar websites do not qualify as academic resources.
Audit Planning and Control for Huawei Technologies Co. Ltd
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Audit Planning and Control for Huawei Technologies Co. Ltd
Tracking and monitoring financial progress in an organization is crucial because it ensures maximum profitability. Therefore, there is a need for regular monitoring and evaluation of financial transactions in an organization to enhance the detection of any existing inconsistency. The most appropriate means of detecting fraud and investigating all financial accounts and transactions in an account is through auditing. Auditing is mostly done by contracted private auditors who tend to analyze the entire financial accounts to determine whether the organizations are suffering any losses due to unscrupulous activities by the finance officers. To ensure complete transparency in matters concerning financial transactions, some organizations prefer combining internal and external auditing, where there are audits by internal auditors and external auditing conducted by contracted auditors from different firms. Hence, organizations should develop strategic audit plans that ensure efficient financial operations analysis without leaving any gaps. This focuses on developing an audit plan for Huawei Technologies Co. Ltd and proposing the important performance ratios to work on for a maximum understanding of the company's financial trends.
Critical steps in Designing an Audit Plan
According to Meliyev (2018), an audit plan is important to ensure potential problems that could hinder effective auditing are detected and dealt with in advance. The plan also provides a blueprint that ensures all the steps are followed to ensure adequate utilization of resources and evaluation of the financial trends based on the type of transactions in the company. With a stable audit plan, there is an assurance of a complete and effective audit process and sufficient risk assessment procedures. With a proper audit plan in place, it is easy to suggest and understand the areas of concern that should be considered when making crucial decisions.
An effective audit plan requires maximum cooperation between the auditors and the audited professionals. The employees could make the audit process easy by presenting all the required materials and resources and ensuring that the auditors are engaged in determining any possible financial leaks. Hay and Cordery (2020) state that the audit plan should include relevant sections that promote the core agenda, such as risk assessment procedures, planned procedures for the audit, and risk identification strategies. A well-outlined audit plan can support the mission, vision, and objectives in all areas pertaining functionality of the business.
de Kleijn and Van Leeuwen (2018) indicate that an audit plan has eight steps that should be followed to achieve the audit objectives. These eight steps include planning, notification, opening meeting, fieldwork, reporting, management response, meeting ending (closure), and audit report distribution. All these proc...