Planning is essential before heading on to the actual performance of that plan. Just like in a marketing plan, it is important to think about the process to have full knowledge on what to do when something comes up. Planning is just preparing one’s self from possibilities that may arise.
In a business, planning means everything. It keeps businesses prepared and resilient to any challenge. Financial plan is important as well but what is crucial for startup business is to have an audit plan that would help make sure that businesses are kept in a good working condition. What does an audit plan mean?
You may hear a lot from people about the word audit. When he hear it, we then think about a company’s performance being investigated. That’s what we think, but what is an audit plan?
It is part of a small business operation to have audit processes to make sure that important areas are given attention and problems would be identified and fix before it starts to complicate. An audit plan is a procedure how an audit process should be carried out or how it should be conducted and when is the best time to perform it.
Audit plans are vital for a business operation.
Audit is the highest assurance that companies are running a business that are illegal. To build an audit plan, the first thing to do is to assess risks that may be a threat to achieving smart goals. Accounting policies must be checked and areas that would be complex should be given high audit consideration.
Audit plan must include internal control as well as thorough test to check the effectiveness of management control plan procedures. After plans are made, it is always good to review the whole plan to avoid errors.
When there is an audit plan, there is also what we call an audit program. Hearing both of those terms, we can say that they are basically the same. But they are not.
What is the difference between an audit plan and an audit program then?
Let’s take them one by one.
Audit is a vital aspect in the simple business plan operation.
Aside from it being required by the Securities and Exchange Commission, the audit plan is important to have an overall strategy of the audit. Through this it would be easy to develop audit program and help in reducing the risk of not being able to carry out the objectives of the audit.
It is important to have an audit plan because this would ensure the effectiveness of the audit procedure and its accordance to the auditing standards.