Audit Program

25/07/2020 1 By indiafreenotes

An audit program is a set of directions that the auditor and its team members need to follow for the proper execution of the audit. After preparing an audit plan, the auditor allocates the work and prepares a program which contains steps that the audit team needs to follow while conducting an audit. Thus, an auditor prepares a program that contains detailed information about various steps and audit procedures to be followed by the audit.

Audit Program

An audit program provides a basic plan for the audit team regarding the entity’s business, its size, how to conduct the audit, allocation of work among team members and the estimation of time within which it should complete the work.

It contains details regarding the relevancy of evidence, materiality level, risk tolerance, measure of the sufficiency of the evidence. Thus, programs enhance the accountability of the audit team and its members for the work performed by them.

An auditor may revise the audit program if he considers it necessary due to prevailing circumstances. The size of the entity, type of business or services in which entity deals, applicable laws, the effectiveness of internal controls, and various other relevant factors, also affect an audit program.

Thus, an auditor prepares an audit program according to its scope of work. The minimum essential work to be performed is the Standard Program. However, there is no set audit standard program applicable in all the circumstances.

Audit working papers document the activities that the audit program performs. Audit working papers support the work performed by the auditor for providing assurance that the audit was performed in accordance with all the applicable standards on auditing (SA’s). It helps the auditor in the proper execution of audit work.

An audit program covers various steps of auditing in an audit program like the assessment of internal control, ascertaining accuracy and reliability of books of accounts, inspection, vouching and verification, valuation of assets and liabilities, scrutiny of accounts, presentation of financial statements, and submission of reports and related disclosures.


Prof. Meigs defines an audit program as, “an audit program is a detailed plan of the auditing work to be performed, specifying the procedures to be followed in verification of each item and the financial statements and giving the estimated time required.”

Features (or) Characteristics of an Audit Programme

The features of an audit programme may be of the following:

  1. It is a set of procedures to be adopted to conduct the audit more efficiently.
  2. It is a written scheme designed by the auditor.
  3. It is a blue print of the audit work.
  4. It facilitates delegation of work, based on the capabilities of audit staff.
  5. It acts as evidence in future for the audit work being performed.
  6. It specifies the work to be done by the audit staff, the manner and time limit for completion of the work.

Objectives of Audit Program

The following are the objectives of audit programme:

  1. To provide clear instructions to the audit assistants specifying the nature of work to be performed and fixing the time span for completion of each work.
  2. To facilitate coordination among various parts of audit work.
  3. To ensure uniformity in the performance of audit work and to avoid duplication and repetition of work.
  4. To attain a fair allocation of work among audit team.
  5. To fix responsibility and accountability of each audit assistant.
  6. To serve as a guide for planning the audit work in future.
  7. To serve as evidence in future showing the date of completion of audit work, methods or procedures undertaken, persons involved in completion of audit work etc.

Contents of an Audit Programme

The following are the details of an audit programme:

  1. Name of the client.
  2. Nature of operations and business of client.
  3. Review of system of internal check.
  4. Date of commencement of audit work.
  5. Duration of audit work.
  6. Accounting system followed in client organization.
  7. Review the report of the previous auditor.
  8. Review the remarks, instructions or objections raised in the previous audit report.
  9. Examine the various ledger accounts and subsidiary books.
  10. Examine the statutory books and registers, profit and loss account, and balance sheet.

Advantages of an Audit Program

An audit programme can give the following advantages:

  1. Helps in Estimation and Division of Work

Audit Programme helps in estimating the quantum of audit work in advance and also helps in dividing the work among the audit assistants based on their capabilities.

  1. Helps in Fixation of Responsibility

It enables to fix responsibility on the audit assistants by clearly defining the scope of work.

  1. Helps in Future Planning

Audit programme serves as a basis for planning the audit work for subsequent year.

  1. Serves as a Guide

It serves as  a valuable guide for the audit staff in execution of the audit work for succeeding years.

  1. Valuable Evidence

It serves as an evidence for the work done as initials of those who have done the particular work are appended to it. The auditor can produce the audit programme as a proof when a charge of negligence being brought upon him.

  1. Uniformity

It provides for uniformity in audit work as the same work will be done every year.

  1. Continuity

When an audit staff goes on leave others can continue the work by referring to the audit programme, hence, audit programme provides for continuity of work.

  1. Coordination

If facilitates coordination and helps in supervising the work of the audit staff.

Disadvantages of an Audit Programme

The disadvantages that may be experienced by conducting audit as per predetermined audit programme are –

  1. Mechancial

When audit work is conducted mechanically every year based on the audit programme, it causes monotony and boredom to the auditor and audit staffs.

  1. No Quality in Work

The audit staff will be more interested to complete the work in time rather than to maintain any standard in the work.

  1. Loss of Initiative

Audit staff cannot take their own decisions and they are compelled to comply with the audit programme. Hence, an efficient audit clerk loses his initiative and interest as he cannot make any suggestions.

  1. Rigidity

A rigid and inflexible audit programme cannot be laid for all types of business. During the course of audit, new areas to be verified may come to the notice of the audit staff. Unless the audit programme is revised, such areas may escape from auditing.

  1. Shelter for Inefficient Staff

Inefficient audit staffs conceal their mistakes or weakness on the basis of audit programme. Hence, it provides shelter for inefficient audit staff.

  1. Unsuitable

Pre-determined audit programme is not suitable for small business organizations.