These refer to a range of financial audit procedures used to assess risk and produce an audit report.
Analytical procedures involve assessing the accuracy of financial information and the financial viability of the organisation by comparison with other financial data (for example from previous periods, against forecasts or industry standards) and also ratio analysis of financial data (for example gross profit to sales, return on capital employed, receivables turnover ratio). The analytical procedure is critical to the audit process as it gives understanding of the organisation and its environment. The ISA 520 Analytical Procedures Standard states the definition and purpose of analytical procedures.
Analytical procedures is a term normally found in risk and control.
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