Bank Branch Audit Checklist for Compliance with ICAI’s Standards on Auditing (SAs)

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It is crucial to ensure quality in bank branch audits through the effective implementation of Standards on Auditing (SAs), just like any other audit engagement. Although the extent of application of SAs may differ significantly based on the size of the branch, it is imperative for the auditor to maintain documentation to demonstrate that the audit was conducted in accordance with the relevant SAs.

To ensure compliance and completeness, it is advisable to maintain checklists for Standards on Auditing (SAs) in the audit documentation file. These checklists can serve as a reference for each audit/assignment conducted. The scope and objective of each SA can be used as a guide while creating the checklists. The following checklist covers the SA 200 to SA 299 – General principles & Responsibilities and SA 300 to SA 499 – Risk assessment & Response to the assessed risks.

I. SA 200 – Overall Objectives of the Independent Auditor and the conduct of an Audit in accordance with Standards on Auditing (SAs)

Scope and Objective: SA 200 lays out the responsibilities of independent auditors when conducting audits of financial statements according to SAs. It defines the objectives of auditors, explains the nature and scope of the audit required to achieve these objectives, and outlines the scope, authority, and structure of the SAs. Additionally, it establishes the general responsibilities of auditors that apply to all audits, including the requirement to comply with SAs.

In conducting an audit of financial statements, the overall objectives of the auditor are:

To obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, thereby enabling the auditor to express an opinion on whether the financial statements are prepared, in all material respects, in accordance with an applicable financial reporting framework
To report on the financial statements, and communicate as required by the SAs, in accordance with the auditor’s findings.

II. SA 210 – Agreeing the Terms of Audit Engagements

Scope and Objective: SA 210 outlines the duties of auditors in agreeing to the terms of an audit engagement with management and, if necessary, those responsible for governance. This involves confirming that certain conditions for an audit, which are the responsibility of management and governance, have been met.

The objective of the auditor is to accept or continue an audit engagement only when the basis upon which it is to be performed has been agreed, through:

Establishing whether the preconditions for an audit are present
Confirm that there is a common understanding between the auditor and management and, where appropriate, those charged with governance of the terms of the audit engagement.

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