ADVANTAGES OF AUDIT PROGRAMME

1. Supervision Of Work :-

The auditor can judge the efficiency of his audit team by holding of an audit programme. He is in a
position to know the progress of the work. He can see at any time that what part of the work has been
completed and what remains to be done.

2. Distribution Of Work :-

Audit programme is very useful in distributing the audit work properly among the members f the audit
team according to their talent.

3. Uniformity Of Work :-

Audit programme helps in settling all the things in advance, so the uniformity of work can be achieved.

4. Basic Instrument For Training :-

Audit programme is very useful for the new auditor. It provides training and guidance to him. So it is
rightly called the basic instrument for training.

5. Legal Evidence :-

Audit programme is a legal evidence of work done by every assistant of the audit team. It can be
presented in the court of law if any client is taken against the auditor for negligence.

6. Fixation Of Responsibility :-

If any error or fraud remains undetected the responsibility of negligence will fall on the particular
assistant who has performed that job.

7. Several Audits may Be Controlled :-

The auditor controls the audit of various companies at the same time. In the absence of audit
programme he can not supervise them effectively.

8. Easy Transfer :-

If one assistant is unable to continue the work given to him, it can be given to another person. Audit
programme guides him that what is done and what is remaining.
9. Final Review :-

Before signing the report, final review is made and for this purpose also auditing programme is very
useful.

10. Useful For Future :-

On completion of an audit, it serves the purpose of audit record which may be useful for future
reference.

DISADVANTAGES OF AUDIT PROGRAMME

1. Not Comprehensive :-

Auditors may have covered the whole field but it can not be said with certainty that all the necessary
work have been done.

2. Rigidness :-

Audit programme looses its flexibility. While each business have a separate problems. So audit
programme can not be laid down for each type of business.

3. No Initiative :-

It kills the initiative of capable persons assistant can not suggest any improvement in the plan.

4. Too Mechanical :-

Such audit programme is mechanical that it ignores many other aspects like internal control.

5. Not Suitable For Small Audit :-

It has been proved that audit programme is not suitable for sail audits.

6. New Problems Over Looked :-

With the passage of time new problems arise which may be over looked.

REMEDY OF DISADVANTAGES:-

The remedy in such situations is that audit programme should be flexible must he always open to
changes and improvements.

What is an Audit Programme?

The written plans prepared by an auditor showing the nature, duration and extent of the audit
procedures to be adopted to conduct the audit more efficiently and effectively is called audit
programme.

While developing the audit programme, the auditor considers;

 Organizational structure of the firm, nature of business, its size and complexity.

 The experience he already had in the organization.

 Present environment under which the organization is functioning.

The auditor before designing the audit programme, holds discussion with the management. He analyzes
the previous year’s working papers, minutes, annual report and internal audit reports.

The auditor distributes the works to the audit staff through audit programmes, thereby facilitating
effective supervision and control of audit.

Revision of audit programme shall be done by Auditor any time after the commencement, if he
encounter any change in circumstances such as weaknesses in internal control in some areas, so that it
suits the current circumstances.

Specimen copy of an Audit Programme

The following is a specimen copy of an audit programme for the year ended 31 March 2015.

Particulars Period of Verification Name of the Persons To be completed by Completed on

Cash Book: A, B 25th July 30th July

Vouching: First 3 and Last 3 Months

Posting:

Casting:First 2 and Last 2 Months

Supervisor Signature:

Signature of Audit Staff:

Purchase Day Book: C, D 29th July 31st July

Vouching: First 1, 2, last and any 1 month in the middle

Posting:

Casting:All the above 5 months

Signature of Audit Staff:

Supervisor Signature

Advantages of Audit Programme

1. All the important areas will be covered in the audit programme and thus there will be no chance of
omitting any important area while conducting the audit.

2. The audit work will be allotted to the audit staff according to their efficiency and experience.

3. Audit programme facilitates better control and supervision of audit work.

4. The subsequent audit programme can be drawn on the basis of the existing audit programme.

5. If any error is found in the audit work, the person responsible for such mistake can be easily found
out.

6. It serves as the evidence for conducting the audit. The auditor uses it as protection, if he is charged
with negligence in performing his duties. He can prove through the audit programme that he has
conducted his work with due care and diligence.

7. The efficiency of the audit staff increases and even if an audit staff goes on leave, others can continue
the work by referring to the audit programme.