Audit planning stands as the crucial inaugural step in the audit process, forming the bedrock of a successful audit. Effective planning ensures a smoother, swifter audit workflow. In the context of audit best practices in South Africa, meticulous planning becomes paramount. It serves as the linchpin for robust, comprehensive, and accurate fieldwork, analytics, issue management, and reporting. By identifying key risks and controls, the planning phase ensures nothing goes unnoticed. Exploring the benefits of this phase, it’s evident that ‘Fail to plan and plan to fail’ holds true. Best practices in audit planning encompass various factors, examining both the process itself and the expected deliverables of audit planning software designed to facilitate success.
What is audit planning?
Internal audits and control are vital, but they can be costly and complex without the proper structure. Whether auditing for internal control purposes or complying with external regulations like Sarbanes-Oxley, effective audit planning enables you to bring order to the process and focus on the right risks to drive strategic insight. Audit planning should be your first step when starting an audit. Executed effectively, it will drive efficiency across your entire audit workflow. Moreover, it should encompass the audit’s scope, nature, and timing. Planning your audit ensures that all areas of the process are covered and given appropriate attention. It can also help you identify any potential problems or obstacles with the auditing process, map out activity to be carried out on time, and manage your audit workflow for maximum efficiency.
Why is it important in South Africa?
In the dynamic business landscape of South Africa, where governance, risk, and compliance obligations continually increase, effective audit planning proves essential. Additionally, businesses grapple with diverse and evolving risks, underscoring the importance of strategically measuring the right risks. Audit processes go beyond tick-box exercises; they are real-world measurements of the ability to manage business processes, policies, and the controls in place. To navigate these challenges and deliver value to boards and top executives, adopting audit best practices in South Africa, especially in the planning phase, becomes imperative.
Benefits of audit planning
Taking the necessary steps will:
- Identify priority areas to ensure you focus where it matters.
- Make audit workflows and processes more efficient.
- Help you to identify, and engage at an early stage, key process owners, and your “first line of defence” reduces costs by minimising duplicate work.
- Identify where manual and recurring internal controls work can be automated, increasing robustness and assurance.
- Enable you to pinpoint and capture the metrics you need to measure and manage enterprise risk across your organisation.
- Drive optimum scheduling and project management.
- Audit planning helps you approach the audit process. You may transition from paper-based, spreadsheet-led auditing processes to a more integrated, risk-driven approach. You may already use technology solutions to support your audits.
Whatever your approach, planning minimises wasted time and duplication and brings crucial focus to the audit process.
What is the best practice in audit planning?
What are the next steps once you’ve recognised that audit planning is crucial for a successful audit? You might be wondering about the process, the key steps involved, and if there are any exemplary practices that you can refer to for guidance.
5 best practice steps
- Assemble your team. Identify who needs to be involved in the audit planning phase. Ensure the inclusion of individuals with a comprehensive understanding of the audit and control process, along with the right skillsets and experience.
- Assess the risks you face. What is the scope of your audit? Your planning must capture all the areas that must be audited to ensure a comprehensive approach. What are your high-priority risks, either because they’re particularly material or more frequently occurring? Review previous years’ audits and identify any new threats since the last one.
- Decide on your audit approach. This will be determined by how you manage audits (using software or manual processes, or a combination of both), categorise the risks identified in step 2 and the resources at your disposal.
- Brief your audit team — ensure they are clear on their roles, your process, timescales and next steps.
- Create a risk-based audit plan for your entire audit universe, including an activity schedule, to ensure a smooth and comprehensive audit process.
Best practice and audit planning tools in South Africa
To ensure comprehensive oversight of your organisation’s risk landscape and control measures, prioritize adhering to best practices in audit planning. Many businesses, therefore, rely on audit planning tools and management software to streamline this process, facilitating the handling of more extensive audits. Integrating software injects structure and rigor into the audit process, especially in audit planning. Furthermore, robust audit workflow software seamlessly supports planning, scheduling, project management, and document management. Additionally, it efficiently captures a library of past audits and templates, ultimately minimising rework and maximising consistency. Furthermore, the latest audit software is versatile, offering usability both offline and through apps for on-site planning and fieldwork. This allows you to use technology to streamline communication within the audit team, thereby expediting reviews and sign-offs. Throughout the entire audit, our innovative audit solutions use technology, making the modern audit process not only quicker and simpler but also more reliable.