Audit procedures are the set of actions used by an auditor in order to analyze an organization and formally draw a conclusion.
Audit procedures, in other words, are a series of activities that are performed to evaluate an entity. This, to then deliver a report with various observations.
Depending on the type of audit performed, there is a wide variety of distinctive procedures. However, the bulk of auditors’ practices show similar patterns.
That is, the elements that make up an audit procedure or process can form a defined methodology.
Thus, the audit procedures constitute the main source of data for the preparation of a formal audit report by the auditor.
Through said model (of processes), a detailed analysis of the target company will be proposed and its evaluation will be carried out step by step.
Features of audit procedures
The auditing practice, despite being considered as a social and economic science by itself, adapts to each target organization.
In other words, the existence of different types of companies or institutions results in the existence of specific characteristics for each evaluation.
In this way, the procedures have certain characteristics:
- Formality: As indicated, the procedures together make up a methodology in itself as an analytical process.
- Adaptation: The procedures can be adjusted to the nature of the evaluated company. In this sense, these procedures are applicable to different areas.
- Specification: There are procedures configured for fields such as efficiency, the use of resources or the analysis of accounting books.
- Regulation: The methodology is framed in the different regulations and legislation of each territory. That is, there is normative coherence.
- Extensive process: Through its application through auditing techniques, the procedures range from the general study to be captured to the conclusions.
Audit procedures and audit techniques
Although in economic practice the concepts of audit procedure and technique are usually identified, there are differences to be taken into account.
Basically, the techniques are the tools of professional or practical application of the auditor’s approaches. These techniques are assimilated into the audit procedures.
Viewed another way, procedures are the way in which the various audit techniques are used and combined.
For example, there are auditing techniques aimed at calculating and checking economic data and ratios. Its application and joint exercise in a given project will make up the audit procedure.