CA Final · Advanced Auditing, Assurance and Professional Ethics · Audit Planning, Strategy and Execution

While auditing Kaveri Textiles Ltd, the engagement team completed its risk assessment procedures and set the overall audit strategy. A junior member asks whether the detailed plan for further audit procedures on trade receivables must be fully finalised before any fieldwork begins. As per SA 300, which is the correct position?

The audit plan develops as the audit progresses. The auditor may start further audit procedures for some classes of transactions, balances or disclosures before planning every remaining procedure, because the nature, timing and extent of specific procedures depend on the outcome of risk assessment procedures.

1. AThe audit plan must be fully finalised for all areas before any further audit procedure is started
2. BThe audit plan develops over the course of the audit, so further procedures for some areas may begin before all remaining procedures are plannedCorrect
3. CPlanning is a one-time activity completed before the audit starts and cannot be revised once fieldwork begins
4. DThe audit plan is less detailed than the overall audit strategy and needs no specific procedures