Audit Planning – Risk Assessment
• What can go wrong? – Who is relying on the numbers? • Which accounts have more risk? • What controls are in place? • Which compliance areas are most important or subject to scrutiny? • Potential for fraud? • Materiality of account? • Assess the level of risk (Low, Medium, High)
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Inherent Risk - Indicators • Prior audit compliance findings, prior areas that required adjustment.
• Changing environments (industry conditions, regulatory requirements, political, management, accounting policies).
• Non-routine transactions, complex calculations, change in estimates or accounting principles.
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BlueBird CPAs
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