The main features of an audit are as follows, with a brief note on the procedures to use:

i. Ascertainment of the nature and constitution of the client's business and how it is carried on. Procedures would include visits to the client's premises, discussions with officers, study of documents such as past accounts, prospectuses, audit files, etc.

ii. Planning and subsequently controlling the audit. Procedures would include preparation of an "audit memorandum" setting out work to be done and timing and staff requirements. A preliminary review of the client's management accounts and previous audit files would also have been required.

iii. Ascertaining, evaluating and testing the client's accounting systems and internal controls. There are several ways of dealing with this. A modern way is to ascertain by asking `grass roots' staff; recording the facts by means of flow charts etc. and evaluating by the use of the `key' questions and criteria questions using a hypothetical or normative model of the appropriate systems.

iv. Carrying out tests on the systems to determine if they are effective and are consistently applied at all relevant times. This is done by means of "compliance" tests preferably operated on a statistically valid basis.

v. Verifying the existence, title and amounts included in the balance sheet in respect of assets, liabilities and capital. This is done by a variety of means including assessment of internal control procedures and by means of "substantive" tests which give direct evidence of the items to the auditor, e.g. bank letter, and debtors circularisation.

vi. Checking the financial statement with the accounting records. This is a requirement of the 7th Schedule of the Companies Act and is achieved by simply making such a comparison.

vii. Examining the income statement to confirm that it reflects the results of the operations of the enterprise. This is achieved by assessment of internal control procedures and the quality of the records, by seeking direct evidence, and by seeking out and probing anomalies or differences from expectations.

viii. Examining the financial statements for conformity with acceptable accounting practices and for compliance with legal and other disclosure requirements. This is achieved by the use of check lists.

ix. Considering the financial statements as a whole and reviewing the audit work and conclusions drawn there from in order to determine whether such statements give a true and fair view. This is achieved by a review conducted by experienced personnel considering the audit working papers, any revealed anomalies and any uncertainties and any disagreements with directors or other parties responsible for the preparation of the accounts.

x. The drafting of an auditor's report giving the auditor's opinion on the truth and fairness and compliance with statute of the accounts. The wording of the report will depend on the conclusion drawn by the auditor from his audit, and the report may be qualified or unqualified.