It eliminates the need for supervision.

It provides clear instructions for the work to be

done.

It increases the possibility of overlooking

important records.

It discourages systematic auditing.

The final audit report framework.

Client risk assessments and resource allocation.

A high-level overview of objectives and scope.

Nature, timing, and extent of audit procedures.

Internal audit report

Engagement letter

Audit strategy

memorandum

Client’s financial

statement

Client's advertising

strategy

Integrity of

management and governance structures

Auditor's financial

interest in the client

Client's market share

Auditors are not required to assess internal

controls

Auditors do not test all transactions

Fraud often involves sophisticated schemes and

deliberate concealment

Auditors focus only on low-risk areas

External regulatory

authorities

Only the engagement

partner

The engagement

partner and key team members

The client’s

management team

Audit provides reasonable assurance, while

investigation is focused on specific purposes

Audit has legal powers of search, while

investigation does not

Audit and investigation have the same objectives

Audit is narrow in scope, while investigation is

broad

A set

of guidelines issued by regulatory authorities.

A

process designed to prevent financial fraud entirely.

A

process designed to provide reasonable assurance regarding the achievement of

objectives.

A

mechanism implemented by auditors to ensure compliance.

Audit

plan precedes the audit strategy, and the audit programme replaces the

strategy.

Audit programme defines the

scope, while the strategy and plan focus on testing.

Audit

strategy is a checklist, audit plan is high-level, and audit programme is about

timing.

Audit

strategy sets the direction, audit plan details the approach, and audit

programme operationalizes tasks.

Optimistic

Trusting of management’s representations

Professional skepticism

Passive