Clients Name:

Exercise Sdn Bhd

Prepared by: Reviewed by:

Helene 16/6/10

Year/Period End: 31-12-07

AUDIT PLAN FOR THE AUDIT OF SMALL AND MEDIUM-SIZED COMPANIES OBJECTIVE:
Prepare an audit plan for the audit of small and medium-sized companies to: 1. determine the audit approach to be adopted for the audit engagement. 2. ensure that audit engagement are performed in accordance with the International Standards on Auditing and International Standards on Quality Control.

PART 1 CLIENT ACCEPTANCE AND RETENTION

No. Procedures CLIENT ACCEPTANCE In evaluating whether to accept a prospective client, the following and other relevant factors should be consider:
Review the available financial information and/or previous years auditors reports and audited financial statements, where applicable. Communicate with the outgoing auditors in accordance with the relevant ethical requirements. Best efforts have been made to identify circumstances or relationships that might create threats to independence, including self-interest threat, self-review threat, advocacy threat, familiarity threat and intimidation threat. The acceptance of the prospective client does not violate other provisions of the code of ethics. Ensure that engagement letter is sent and the acknowledged copy of the engagement letter is received and filed in the working paper. Others (Please describe)

X-Ref

Yes

No

N/A

1
1.1

1.2 1.3

1.4 1.5 1.6

CLIENT RETENTION At a minimum, review whether to retain a client prior to the commencement of the audit engagement (consider the following points, if necessary).
A major change in management, ownership, financial condition, principal activities, size of the operations, litigation status, scope of the engagement, etc. Consider whether there is a violation against the code of ethics. Review the results of the audit from the prior years audit working papers.

2.1

2.2 2.3

AXP Solutions & Co.

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Clients Name:

Exercise Sdn Bhd

Prepared by: Reviewed by: X-Ref

Helene 16/6/10

Year/Period End: 31-12-07 No.

2.4 2.5

Procedures
Consider the necessity of re-sending engagement letter. Others (Please describe)

Yes

No

N/A

PART 2 ESTABLISH TERMS OF ENGAGEMENT

No. Procedures Initial Audit For the initial audit, has the engagement letter been agreed by client (consider the following minimum points to be included)?
Objective of the audit Managements responsibility for the financial statements Scope of the audit Form of the reports or deliverables Inherent limitation of audit, accounting and internal control and their impacts Unrestricted access to records, documents and information Planning of audit Management representation made in connection with the audit Acknowledge receipt of the engagement letter Basis of the fee computation and billing arrangements

X-Ref

Yes

No

N/A

1
1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1.10

Has the acknowledged copy of the engagement letter been filed in the audit working paper? Recurring Audit For recurring audits, are there circumstances that require the terms of the engagement be revised or the letter of engagement be re-sent (consider the following points)?
Indication that the client misunderstands the objective and scope of the audit Revised or special terms of engagement Changes of senior management, Board of Directors or ownership Significant change in nature and size of the clients business Legal requirements Other reasons

3.1 3.2 3.3 3.4 3.5 3.6

AXP Solutions & Co.

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Clients Name:

Exercise Sdn Bhd

Prepared by: Reviewed by:

Helene 16/6/10

Year/Period End: 31-12-07

PART 3 CLIENTS NEEDS FOR THE ENGAGEMENT

Obligations Regulatory agencies/departments Holding companies Others Details 1. Companies Commission of Malaysia 2. Inland Revenue Board

PART 4 ENGAGEMENT TEAM

Position Audit engagement: Audit Partner Audit Manager In Charge Other field staff Tax engagement: Tax Partner Tax Manager Other engagement: Partner Manager Name Years of service for this client Proposed Date of Commencement

AXP Solutions & Co.

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Clients Name:

Exercise Sdn Bhd

Prepared by: Reviewed by:

Helene 16/6/10

Year/Period End: 31-12-07

PART 5 ASSESSMENT OF ENGAGEMENT RISK

In developing our overall audit plan, we should assess inherent risks at the financial statements level. We should also obtain an understanding of the control environment sufficient to assess directors and managements attitude, awareness and actions in regard to internal controls, and their importance in the company. Risk Assessment High Med Low

No. 1 2 3 4 5 6 7 8 9

Areas of Appropriateness of the organisation structure Attitude and characteristic of the management Nature of business activities and industry conditions Compliance with laws and regulations Likelihood of fraud and error Financial and operating activities Nature of the audit engagement Managements control system Our prior knowledge

X-Ref

If potential risks are identified, to document our findings in the following table: No. Risks Identified Mitigation Factors Proposed Responses

AXP Solutions & Co.

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Clients Name:

Exercise Sdn Bhd

Prepared by: Reviewed by:

Helene 16/6/10

Year/Period End: 31-12-07

PART 6 CLIENTS PERSONNEL

Type Key Decision Makers Key Management Staff Key Accounting Staff Other Accounting Staff Position Name

PART 7 CLIENTS CONTACT

Main Address Telephone No. Fax No. E-mail Address Company Secretary Tax agent Major bankers Others (please specify) Suite 25.3, Level 25,, Menara Standard Chatered,, 30, Jalan Sultan Ismail,, 50250 Kuala Lumpur.

PART 8 TIME COST BUDGET

Personnel Partner Audit Manager Audit Senior Other field staff (1) Other field staff (2) Estimated Hours Charge Out Rate Amount (RM) -

AXP Solutions & Co.

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Clients Name:

Exercise Sdn Bhd

Prepared by: Reviewed by:

Helene 16/6/10

Year/Period End: 31-12-07

PART 9 COMPUTATION OF RECOMMENDED AUDIT FEE

Gross Revenue Industry Definition Pls select Please select the client's industry

Total Assets Definition

The total of all assets excluding intangible assets as shown in the Balance Sheet. All expenses charged against gross profit to arrive at net profit before tax but excludes direct cost of sales. RM 800 800 -

Total Operating Expenses Definition

Fee Computed Based On: Gross Revenue Total Assets Total Operating Expenses Estimated time costs

Proposed Audit Fee

Reason(s) for variation of the proposed audit fee from the recommended audit fee computed:

AXP Solutions & Co.

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Clients Name:

Exercise Sdn Bhd

Prepared by: Reviewed by:

Helene 16/6/10

Year/Period End: 31-12-07

PART 10 TRIAL BALANCE, GENERAL LEDGER & OPENING BALANCE

No. Audit Procedures Additional Procedures For Initial Audit Obtain sufficient appropriate audit evidence that the opening balances are correctly carried forward to the current year (consider the following procedures).
Any change in the accounting policies? Where there are changes of the accounting policies, are adequate disclosures made? Are the accounting policies appropriate for the Company? Were the previous years financial statements audited by an approved Companys auditor? Was the previous years audited opinion modified? Are the outgoing auditors allowing us to review their audit working papers (consider the requirements of the Code of Ethics)? Do the outgoing auditors audit working papers contain sufficient appropriate audit evidence?

X-Ref

Yes

No

N/A

1.1 1.2 1.3 1.4 1.5 1.6 1.7

2
2.1 2.2 2.3

Audit Work on Trial Balance

Obtain a copy of the trial balance as at the balance sheet date. Agree balances in trial balance to the general ledger. Re-calculate the trial balance.

3
3.1 3.2

Audit Work on General Ledger and Journals

Agree opening balance of general ledger to prior years audit working papers or audited trial balance. Scan through general journals to ensure that all material or unusual journal entries are properly authorized, and consider the impacts of the journal entries on the audit of the financial statements.

AXP Solutions & Co.

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Clients Name:

Exercise Sdn Bhd

Prepared by: Reviewed by:

Helene 16/6/10

Year/Period End: 31-12-07

PART 11 COMMUNICATION OF AUDIT PLAN

In normal circumstances, audit plan will be communicated by partner / manager to the audit senior or staff in charge before the commencement of the engagements.

Audit Plan has been briefed by:

Name:

To:
Name:

FINDINGS:
No. Issues Impacts Recommendations

2006

2010

by

AXP

Solutions

Sdn.

Bhd.

All

rights

reserved.

AXP Solutions & Co.

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