Once you have determined which balances are material and identified the risks for your engagement, the next step is to assess what level of risk exists for each of the financial statement areas.
The default Audit Areas provided are directly linked to the audit program provided under the Mercia methodology, however, you can add in additional Audit Areas as required, which is covered a little further down the page.
On this page we will cover:
- Identify the specific Audit Area you are assessing the risk of (i.e. Sales and Other Income)
- Using professional judgement and audit evidence gathered during the planning stage of the Audit, select whether the Inherent Risk and Control Risk have been determined as High, Medium, or Low
- Repeat procedures 1 and 2 for all other relevant Audit Areas
Adding custom areas is quick and easy and is very similar to how you add additional risks to your audit plan.
- Identify the section in which you want to add an additional Audit Area (e.g. H Sales and Debtors)
- Hover your mouse at the bottom of the last Audit Area until the Add Audit Area button appears
- Press the Add Audit Area button
- Type in a description of your new Audit Area
Note: The new audit area does not have the small lock icon showing. The lock icon indicates that it is a default Audit Area and is integrated with the audit programme for that section (e.g. H3 Sales and Debtors Programme)
The ability to delete risks has been safely stored behind the Edit Mode in the Audit Plan, ensuring that accidental deletion of audit areas that are linked to audit programmes is minimised. As mentioned in the Audit Plan Basics section of this help centre, access to Edit Mode is restricted via the Roles and Permissions module. For more information on this, please visit the Audit Plan Basics page.
To delete an audit area, please complete the following steps:
- Access Edit Mode in the Audit Plan by pressing the Edit Mode button on the top left-hand corner of the screen
- Identify the audit area you want to delete and press the red delete icon to the right of the audit area
- Press OK to permanently delete the audit area
Attention: Once the audit area has been deleted, it cannot be recovered and any linkage to the audit programme will be gone
- When finished deleting all audit areas no longer required, press the Edit Mode button again to close out from edit mode