What is Audit strategy and audit plan?

Q: What is Audit strategy and audit plan?

The audit strategy sets the scope, timing and direction of the audit; the audit plan sets the nature, timing and extent of procedures responding to risks. The strategy covers materiality, focus areas, team structure and the need for experts. The plan is updated as the risk assessment progresses and is documented in the audit file.

The strategy covers materiality, focus areas, team structure and the need for experts. The plan is updated as the risk assessment progresses and is documented in the audit file.

Source: BDS 300

Related terms

MaterialityA misstatement being large enough, individually or together with others, to influence the economic decisions of users of the financial statements.Audit riskThe risk that the auditor expresses an inappropriate opinion when the financial statements are materially misstated.Risk of material misstatementThe risk that the financial statements are materially misstated, due to error or fraud, before the audit; it consists of inherent risk and control risk.Adverse opinionThe opinion in which the auditor states that the financial statements are not presented fairly, where misstatements are both material and pervasive.Agreed-upon proceduresAn engagement in which the practitioner performs procedures agreed with the entity and, where relevant, a third party, and reports only the findings without providing assurance.Analytical proceduresThe evaluation of financial information through analysis of plausible relationships among financial and non-financial data.

Last updated: October 31, 2026 · This definition is for general information only.