BY

Atta-ur-Rahman Arif

A system by which an auditor obtains reasonable assurance that: his expression of audit opinion

reflects observance of approved auditing standards

any statutory or contractual requirement

any professional standards set by him or his f irm

A system of : Delegating the responsibil it ies to

the subordinates Directing how to conduct an audit Supervision the staf f Review the work per formed by

them

Control has to bo exercised through some laid down procedures for which no hard and fast rules. It depends upon the organisational structure of the audit f irm, to which extenet the audit work has been delegated.

Every control should take into consideration the following elements: Audit staf f should be equipped with

necessary training, experiance and profeciancy

Audit staf f should brief with: Their responsibil it ies and objective Nature, Extenet and Timing of the

planned procedure Accounting and Auditing problems

Working papers Procedures established should ensure

that: Work per formed by audit staf f is

reviewed by a senior Audit work was adequately per formed Work per formed confirms the result

obtained Result derived ful ly suppor t the

conclusion forming basis of audit repor t

Delegation Directing Supervision Reviewing

The audit work should be delegated to assisstants in a manner which provides reasonable assurance that the work shall be per formed with: Independence Skil ls Competence required under the

circumstances

Direction to assisstants would include: Their responsibil it ies Objectives of procedures to be

per formed Nature of business Accounting and Auditing problems

that may occure Audit programme Time Budget and Planning

Memorandum

Supervisors per form the functions of: Monitor the progress of the audit to

consider whether: Assisstants have the necessary

skil ls and competence Assisstants understand the

directions Work is being carried out in

accordance with the overall audit plan and the audit programme

Address signif icant accounting and auditing questions raised during the audit

Resolve any dif ference of professional judgement between personnel

I t includes: Work has been per formed in accordance

with programme Work per formed and results obtained

have been properly documented All matters have been resolved Objective of audit procedures have been

acheived Conclusions are consistent with the

result

PRESENTED BY

Atta-ur-Rahman Arif

Quality Control refers to al l measures under taking by an audit practice which are designed to assist in achieving a high quality of audit and of the audit repor t issued and wherever considered necessary to improve quality.

1. It promotes observance of the professional standards relevant to the work of an Auditor.

2. How overall quality of the work carried out within the f irm can best be monitored and maintained.

3. Provides reasonable assurance that al l audits carried out by the f irm are per formed in accordance with approved auditing standards.

4. Reduce the audit risk by ensuring that an opinion on the f inancial statements is properly arrived at and worked.

5. Firm must have suf f icient direction, supervision and review of work at al l levels to provide reasonable assurance that the work per formed meets appropriate standards of quality

Factors af fects the nature and extent of the policies Size of f irm Nature of f irm’s practice Number of f irm’s of f ices Organization of Firm

1. Professional Requirements2. Skills and Competencies3. Assignment4. Delegation5. Consultation6. Acceptance and Retention of Clients7. Monitoring

Personnel in the firm should adhere to the principles of independence, objectivity, confidentiality and professional behaviour

The firm should be staffed by personnel who have attained and maintained the technical standards and professional competence required to enable to fulfill their responsibilities with due care.

Audit work is to be assigned to personnel who have the degree of technical training and proficiency required in the circumstances.

There should be sufficient direction, supervision and review at all levels to provide reasonable assurance that the work performed meets appropriate standards of quality.

Whenever necessary, consultation within or outside the firm is to occur with those who have appropriate expertise.

An evaluation of prospective clients and a review, on an on-going basis, of existing clients is to be conducted. In making a decision accept or retain a client, the firm’s independence and ability to serve the client properly and the integrity of the client’s management are to be considered.

The continued adequacy and operational effectiveness of quality control policies and procedures should be monitored.