INTERNATIONAL STANDARD ON AUDITING 520 ANALYTICAL PROCEDURES

Overview:

This International Standard on Auditing (ISA) deals with the auditor’s use of analytical   procedures   as   substantive   procedures   (“substantive   analytical   procedures”).  It also  deals  with  the  auditor’s  responsibility  to  perform  analytical procedures near  the  end  of  the  audit  that assist the  auditor  when forming   an   overall   conclusion   on the   financial   statements.  

ISA   315 (Revised)1 deals with the  use  of  analytical  procedures  as  risk  assessment  procedures.  ISA  330  includes  requirements  and  guidance  regarding  the  nature,  timing  and  extent  of  audit  procedures  in  response  to  assessed  risks;  these audit procedures may include substantive analytical procedures

Objective:

The objectives of the auditor are:

(a)To obtain relevant and reliable audit evidence when using substantive analytical procedures

(b)To design and perform analytical procedures near the end of the audit that assist the  auditor  when  forming  an  overall  conclusion  as  to whether  the  financial  statements  are  consistent  with  the  auditor’s  understanding of the entity.