Audit Tests / Audit Work / Audit Procedures

[Zaini]

While solving past papers on audit procedures you all must have come across these terms. Now , what I understand is that work and procedures (substantive) means the same. But what exacly is meant by Audit Tests?:confused:

[Vanessa]

While solving past papers on audit procedures you all must have come across these terms. Now , what I understand is that work and procedures (substantive) means the same. But what exacly is meant by Audit Tests?:confused:

[B]Audit test refers to the techniques of gathering audit evidence.

The most commonly used audit tests are:
 test of controls: which enable to determine the adequacy and effectiveness of the internal controls.
 Substantive procedures: which are designed to detect material misstatements at the assertion level.

Audit procedure refer to the procedures followed or methods used by the auditor during the course of audit. For example the audit procedure for accounts payable would include:
 obtaining suppliers’ statements or confirmation certificates from the suppliers
 comparing the balances in the statements with the balances in the entity’s books
 obtaining reconciliation and list outstanding invoices, debit notes and outstanding cheques etc. for large amounts
 enquiring into old and unusual items
 comparing the balances of major suppliers with the related names and amounts in the trial balance
 comparing the total amount of account payables in the trial balance with the total amount in the general ledger.
The audit procedures would differ for the various account heads. Also the audit tests would be different for the different account heads.

Audit work comprises of the entire task of audit right from being appointed as auditors up to preparation of the audit report.
It would include all the audit procedures and audit tests carried out for the various expenses, incomes, assets and liabilities. The results of these activities must enable the auditor to form a ‘true and fair’ opinion of the financial statements.