Wiley Federal Government Auditing: Laws, Regulations, Standards, Practices, and Sarbanes-Oxley, 2nd Edition

CHAPTER 8

PLANNING THE AUDIT

Well Done Is Half Done

At the outset of an audit, the auditor must have a clear idea of the audit scope to identify a process that will achieve audit objectives. Chapter 7 provided a summary of the Federal audit model that was jointly developed by the U.S. Government Accountability Office (GAO), the President’s Council on Integrity and Efficiency (PCIE), and the Office of Management and Budget (OMB). Exhibit 7.1, “Federal Audit Model—Agency Financial Statements,” displays, in a graphic format, the audit phases, procedures, and tasks for this model that are described in some 1,000+ pages of Federal guidance appearing in the Financial Audit Manual (FAM), Federal Information System Controls Audit Manual (FISCAM), and the Standards for Internal Controls in the Federal Government. Models and checklists are useful tools and can assist in the development of an effective audit approach and audit procedures; however, a model is not a plan.

The first auditing standard of fieldwork states, in part: “The auditor must adequately plan the work.” This simple, straightforward, and patently obvious statement, however, is no mere tautology. Planning is at the core of every successful audit; and conversely, failed audits can often be attributed to a poor, minimal, or partial plan. The breadth, depth, duration, and effectiveness of the planning phase is directly dependent on the auditor’s access to the Federal auditee’s personnel, the agency’s underlying data and information ...