Analytical procedures

Analytical Procedures is one of financial audit skill which help an auditor understand the client's business and changes in the business, to identify potential risk areas and to plan other audit procedures. Analytical Procedures include comparison of financial information (data in financial statement) with prior periodsbudgetsforecastssimilar industries and so on. It also includes consideration of predictable relationships, such as:gross profit to sales, payroll costs to employees,financial information and non-financial information, for examples the CEO's reports and the industry news.
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