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An Audit Procedure outlines the specific steps and methods auditors use to examine financial records, internal controls, and business operations. In New Zealand, these procedures follow standards set by the External Reporting Board (XRB) and help ensure companies meet their obligations under the Companies Act 1993 and Financial Markets Conduct Act 2013.

Good audit procedures protect both businesses and stakeholders by detecting errors, preventing fraud, and confirming compliance with NZ accounting standards. They typically include reviewing documents, interviewing staff, checking calculations, and verifying transactions - all guided by professional judgment and designed to gather reliable evidence about an organization's financial health and operational practices.

Companies need Audit Procedures when preparing for annual financial audits, changing accounting systems, or responding to regulatory investigations. These procedures become essential during major business changes like mergers, new public listings, or when expanding operations under New Zealand's Financial Markets Conduct Act requirements.

Audit Procedures are particularly valuable when addressing specific risk areas, such as inventory management, revenue recognition, or payroll processing. They help businesses maintain compliance with XRB standards, protect against fraud, and provide reliable financial information to stakeholders. Many organizations also use them during internal reviews to strengthen controls and improve operational efficiency.

• Audit Program For Inventories: Focuses on stock valuation, physical counts, and inventory management systems
• Audit Program For Accounts Payable: Examines supplier payments, purchase orders, and creditor reconciliations
• Audit Assertions For Payroll: Reviews employee compensation, tax compliance, and benefit calculations
• Audit Test Plan: Outlines testing strategies for overall financial statement accuracy
• Financial Analytical Review: Evaluates financial ratios, trends, and performance indicators

• External Auditors: Independent professionals from chartered accounting firms who design and execute audit procedures according to XRB standards
• Internal Audit Teams: Company employees who develop and implement ongoing audit procedures for risk management and control
• Finance Directors: Oversee the audit process and ensure procedures align with company objectives and regulatory requirements
• Board Members: Review audit findings and approve major procedural changes through the audit committee
• Department Managers: Provide necessary documentation and ensure staff cooperation during audits
• Compliance Officers: Monitor adherence to audit procedures and maintain documentation for regulatory purposes

• Business Overview: Gather key information about company structure, operations, and reporting systems
• Risk Assessment: Identify high-risk areas and specific control requirements for your industry
• Regulatory Review: Check current XRB standards and Financial Markets Authority guidelines
• Document Collection: List all financial records, policies, and procedures that need examination
• Team Assignment: Define roles and responsibilities for each audit area
• Timeline Planning: Set realistic deadlines for each audit phase and review points
• Technology Check: Confirm access to necessary accounting software and audit tools
• Quality Control: Our platform ensures your audit procedures meet all legal requirements and industry standards

• Objective Statement: Clear purpose and scope of the audit, aligned with XRB standards
• Methodology Section: Detailed description of testing procedures and sampling methods
• Risk Assessment: Identification of key risk areas and control measures
• Documentation Requirements: List of required records and evidence collection methods
• Compliance Framework: Reference to relevant NZ accounting standards and regulations
• Quality Control Measures: Steps for review and verification of findings
• Reporting Structure: Format and timing of audit communications
• Confidentiality Provisions: Data protection and information handling protocols
• Review Process: Our platform ensures these elements are properly included and legally compliant

An Audit Procedure differs significantly from a Compliance Procedure in several key ways. While both documents support organizational governance, they serve distinct purposes and operate differently under New Zealand regulations.

• Purpose and Scope: Audit Procedures focus on examining and verifying financial statements and operations, while Compliance Procedures outline ongoing rules for meeting regulatory requirements
• Timing and Frequency: Audit Procedures are typically executed at specific points (annual, quarterly) whereas Compliance Procedures provide continuous guidance
• Implementation: Audit Procedures require active investigation and evidence gathering, while Compliance Procedures serve as standing instructions
• Output Focus: Audit Procedures result in specific findings and recommendations, whereas Compliance Procedures aim to prevent violations and maintain standards
• Legal Framework: Audit Procedures align with XRB standards and auditing requirements, while Compliance Procedures cover broader regulatory obligations