How to Conduct an Audit Investigation with Efficiency and Compliance
In the world of corporate auditing, accuracy in the collection of information and verification of accounting data are essential to the reliability of financial reports.
This article brings together the main audit research procedures and techniques, according to current good practices and accounting standards, with a focus on the performance of technicians, auditors and project coordinators.
The importance of audit research
According to the NBC-T11 standard, the audit combines techniques and procedures that seek to obtain sufficient and appropriate evidence to support the auditor's opinion.
Each conclusion must be supported by verifiable evidence obtained through tests, observation, interviews and documentary analysis.
Forming a professional opinion on financial statements requires methods to identify risks, verify transactions and ensure compliance with accounting and legal principles.
Compliance test: assessing internal controls
The compliance test aims to examine the effectiveness of an organization's internal controls. It evaluates whether these mechanisms are implemented, operate continuously and comply with management guidelines.
This type of test is essential in higher risk areas such as purchasing, sales, costs and personnel.
Its application may include direct inspection, observation of processes, document research and confirmation of records.
When properly executed, it allows to determine if the controls are reliable or if additional, more in-depth testing is needed.
Substantive tests: validating accounting data
When compliance tests reveal weaknesses, the auditor applies substantive tests. These procedures directly evaluate accounting balances and transactions, ensuring that they are correct, valid and free of material misstatement.
Among the most common methods are:
- Physical count of inventories
- Review of invoices and bank statements
- Analysis of collections and payments
- Verification of tax and labor calculations
- Evaluation of auxiliary accounting records
These tests are essential to detect accounting irregularities or fraud, such as the overstatement of assets or understatement of liabilities, which affect the veracity of the results.
Analytical review: detecting variations and trends
The analytical review is one of the most widely used procedures in auditing. It consists of comparing actual values with expected values to detect deviations, trends and financial anomalies.
For example, unexpected variations in revenues or profit margins may indicate errors or inconsistencies.
This analysis is complemented with consultations and requests for documentation, strengthening the evidence base for the final report.
Interviews in auditing: strategy to obtain information
Audit interviews are a powerful research tool. They are classified into 3 types:
- Introductory interview: serves to explain the objectives of the audit.
- Data collection interview: seeks essential information and specific details.
- Closing interview: presents findings and final recommendations.
During the data collection interview, the auditor should ask clear questions, listen actively and accurately record responses.
Empathy and objectivity are essential to build trust and collaboration with interviewees.
Recording of interviews: accuracy and objectivity
All information obtained should be recorded in a clear and orderly manner, avoiding interruptions or subjective interpretations.
It is advisable to take notes immediately after the interview, using key words and relevant observations.
Separating facts from opinions facilitates a more reliable and objective analysis.
Conclusion: auditing as a tool for transparency and governance
A well-executed audit investigation strengthens transparency and corporate governance.
Proficiency in compliance testing, substantive testing and interviewing helps to detect failures, reduce risks and ensure financial integrity.
At PetroShore Compliance, we maintain a constant commitment to excellence in auditing and corporate investigation, training ethical professionals prepared to deliver reliable results.
Frequently Asked Questions:
✔ What is an audit investigation?
It is the process by which evidence is obtained and data is analyzed to assess the accuracy of financial information.
✔ What is the difference between compliance test and substantive test?
The compliance test evaluates the effectiveness of internal controls, while the substantive test directly validates accounting balances and transactions.
✔ Why are audit interviews important?
Because they allow us to confirm data, obtain qualitative information and better understand the company's internal processes.
✔ What does the analytical review provide?
Helps identify unusual variations and financial trends that could indicate errors or irregularities.
We offer Audit and Compliance Services for your company. Compliance and Corporate Ethics Training for your team
🔗 More information at FAC - International Federation of Accountants.
🔗 More information on COSO - Internal Control Framework
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