Internal Audit Handbook（2007）C3-Selected Financial Audit Topics.pdfVIP

Examples from Audit Practice at SAP C | 3 | 3.1 Selected Financial Audit Topics Analytical Procedures 3 Selected Financial Audit Topics 3.1 Analytical Procedures Key PoinTS ••• • Analytical procedures consist of an analysis of figures and ratios and/or groups of figures and ratios and their development over a defined period. • Analytical procedures are important tools for effectively performing any type of audit. • There are different categories of analytical procedures, e.g., plausibility checks, trend analysis, and ratio analysis. • Analytical procedures can be used during audit preparation, audit execution, and reporting. As described in Section B, Chapter 4.1.2, analytical procedures are an important tool BasicsBasics of audit work. The procedures consist of an analysis of individual figures and ratios and/or groups of figures and ratios. Analytical procedures also include analyzing the development of these figures and ratios over a defined period. The auditors’ task is to use their judgment to examine critically any variances (or the lack of variances) between figures and groups of figures and assess the results. In this process, forecasts can be generated based on external market and sector information or company-in- ternal information (strategy, processes, guidelines, budgets, prior-year figures, etc.). Analytical procedures are important for the effective performance of any type of SignificanceSignificance audit, because they help focus the extent of the audit work to be done. They can be used to obtain a comprehensive picture of the organization’s s