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CA Intermediate · Auditing and Ethics · Audit Strategy, Audit Planning and Audit Programme

While planning the audit of Shree Ganesh Foods Ltd., CA Rohan notes that the company has started using a new ERP system this year, and the entity's year-end is 31 March. He is considering whether to involve other team members and when to discuss the audit. Under SA 300, who should the engagement partner and other key team members involve in planning discussions, and what is the correct approach?

The engagement partner and other key team members must be involved in planning, including planning and taking part in the engagement team discussion. SA 300 requires this involvement, and a new ERP system makes such discussion more necessary rather than less.

  1. AThe engagement partner and key team members should be involved in planning, including planning and participating in the team discussionCorrect
  2. BOnly junior staff should plan, as partners should join only at the reporting stage
  3. CPlanning should be done solely by management's internal audit department
  4. DPlanning discussion is unnecessary where the client has an ERP system

Explanation

SA 300 requires the engagement partner and other key members of the engagement team to be involved in planning the audit, including planning and participating in the discussion among team members. Delegating planning to juniors or to management's internal audit departments is not consistent with the Standard. An ERP system adds to the need for discussion, not removes it.

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