What is the main purpose of an audit plan?
Correct answer: D. To determine the audit’s scope, timing, and direction
- A. To prepare the client’s financial statements
- B. To guarantee that all fraud will be detected
- C. To replace the client’s internal control system
- D. To determine the audit’s scope, timing, and direction
Explanation
An audit plan sets the overall scope, timing, and direction of the audit. It helps the auditor allocate resources and respond to assessed risks, but it does not prepare accounts or guarantee fraud detection.
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About Auditing
Auditing examines accounting records and financial statements to determine whether they present a reliable and fairly stated position. The subject covers audit objectives, internal controls, audit evidence, materiality, vouching, verification, working papers, auditor independence, audit reports, and the distinction between an audit and accounting or investigation.
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