Planning the Audit
White Nelson Diehl Evans is an accounting firm that has rigorous planning processes . Our practice is to build audit plans with the close cooperation of our clients. We never impose cookie-cutter audit plans on our customers, but rather work out each engagement’s unique features. We understand that the customer has the greatest knowledge about their company and industry, and incorporating this input into the plan is key to streamlining the process.
The audit plans that White Nelson Diehl Evans develops have several steps. First, we understand the business, its controls and flow of information. We identify material locations, significant accounts, transactions and processes. We then assess the financial reporting risk. Finally, we create a complete strategic audit plan in which we specify the information we will need to execute the audit. This up-front planning is invaluable, because it gives the client an opportunity to evaluate the plan and understand the information that must be provided in the course of the audit.
Among the special areas we address are inventory costing and the effects of different inventory valuation methods on particular product segments; related parties; providing analysis under different scenarios or “what if” modeling, to help business executives with a full range of strategic and tactical decisions. We evaluate transactions for completeness, accuracy, cutoff and classification.
Careful audit planning is required to create and successfully execute a schedule of critical dates and a computer template for data collection. We work closely with our clients to establish all the key calendar dates, such as the start of fieldwork, interim testing, inventory observation, confirmation of accounts payable and accounts receivable, legal matters, presentation and exit. Clients find it very reassuring to know the schedule in advance and for the audit team to effectively set the expectations. Our goal is to provide the financial statements as expeditiously as possible after completion of the audit.