Planning :
SA 300, “Planning an Audit of Financial Statements” requires that the auditor shall undertake the following activities prior to starting an initial audit:
(a) Performing procedures required by SA 220, “Quality Control for an Audit of Financial Statements” regarding the acceptance of the client relationship and the specific audit engagement; and
(b) Establish understanding of terms of engagement as per SA 210, “Agreeing the Terms of Audit Engagements”
Planning would involve establishing overall audit strategy to set the scope, nature, timing, extent of resources required and direction of audit. The audit plan needs to be properly documented with respect to timing, extent of checking, audit procedures to be followed at assertion level and should be flexible and updated or changed as and when necessary. Further the audit plan should be communicated to the audit team. SA 220, “Quality Control for an Audit of Financial Statements” establishes standards on the quality control, generally, and with regard to the work delegated to assistants on an individual audit. Before starting initial audit engagement, perform procedures required under SA 220 regarding client acceptance etc. Also ensure that a proper communication has been sent to the predecessor auditor. The auditor should also keep in mind the requirements of SQC 1, “Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements”.
The below-mentioned procedures, as applicable to Head Office, may also be applicable in case of audit of a Branch Office, modified to the extent
relevant for the particular branch audit assignment.