Understanding the client

This is the very first step of any audit. Remember that audits are customised to the unique characteristics of the client at that point in time. ISA/ASA315 is the first step – you’ll often do this at a high level in the early planning stages.

As part of understanding the client, you also need to understand the internal controls. Interviewing the client and then documenting that work in a flowchart is essential.

It is highly advisable to ask your client to go on a tour of their business – this way you can match up what staff tell you with what they actually do. Here is an example of me visiting a retailer and identifying internal controls.

You will also need to evaluate the IT-based controls – there are 2 main types

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