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CMA Final · Cost and Management Audit · Basics of Cost Audit

As per SCA 103, the 'Overall Audit Strategy' in a cost audit is best described as the strategy that:

Under SCA 103, the overall audit strategy sets the scope, timing and direction of the audit and guides the development of the detailed audit plan. It is therefore a framework that precedes and directs the plan, rather than replacing it.

  1. ASets the scope, timing and direction of the audit and guides development of the detailed audit planCorrect
  2. BFixes the cost auditor's fee and the date of the board meeting
  3. CReplaces the need for any detailed audit plan
  4. DRecords the management's cost accounting policies for the year

Explanation

The definition in SCA 103 says the overall audit strategy sets the scope, timing and direction of the audit and guides the detailed audit plan. It does not replace the plan, which it guides. Fees and accounting policies are unrelated to it.

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