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Audit procedures

Audit procedures
Observation
Observation consists of looking at a process or procedure being performed by others. It could be used here
to observe employees scanning their cards when they start and finish a particular shift. However, its use is
limited because it only provides evidence that the process happened at the time of observation. It should be
used in conjunction with other audit procedures.
Inquiry
Inquiry consists of seeking information of knowledgeable individuals, both financial and non-financial,
throughout the entity or outside the entity. This can be used to find out how the time recording system
works by interviewing relevant staff so would be a good procedure to use.
Recalculation
Recalculation consists of checking the mathematical accuracy of documents or records. It could be used to
calculate the hours worked according to the information on the time recording system.
Reperformance
Reperformance is the auditor's independent execution of procedures or controls that were originally
performed as part of the entity's internal control, either manually or using computer-assisted audit
techniques. The auditor could test the controls in place within the time recording system using CAATs.
Analytical procedures
Analytical procedures consist of evaluations of financial information by studying plausible relationships
among both financial and non-financial data. They can be used in this case to compare the time recorded per
the system to the standard hours per employee plus any overtime worked.
(Note: Only four were required.)
Tutorial note
inquiry where a representation of information or of an existing condition is obtained directly from a third: Confirmation would not be a valid procedure in this question because confirmation is a type of

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