Practical Guide to the Standard on Cost Auditing (SCA) 101 - Planning an Audit of Cost Statements - DRAFT

Planning cost statement audits: establish strategy and plan, assess risks and materiality, document procedures and changes. The Guidance Note to SCA 101 requires cost auditors to perform pre engagement checks (appointment, ethics, terms), develop an Overall Audit Strategy and a detailed audit plan tailored to the entity's characteristics, assess risks of material misstatement through understanding the entity and performing inquiries, analytical procedures and inspections, and to design responses linking nature, timing and extent of procedures to assessed risks. Auditors must determine materiality, document and update strategy and plan as needed, consider reliance on others and experts, and maintain comprehensive audit documentation of procedures, changes and judgements.