Planning Memorandum

1.0 PLANNING MEMORANDUM

Entity File ref.

Audit assignment Accounting period

Audit objective(s)

Audit directorate/section Responsible auditor/Team leader

Prepared by/ Reviewed by Approved by

sign/date Sign/date Sign/date
(Team leader) (Deputy director) (Director)

Comments Comments

Proposed key audit areas and reasons for selection

Follow up of unresolved previous issues (Ref 1.12) Ref.doc

New issues Ref.doc

Audit approach or strategy and Scope

Proposal for IT Audit section to be involved?

Yes/No

For proposed materiality levels see the Materiality Assessment form.

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KNOWLEDGE OF THE BUSINESS/ENTITY

1.1 General Background

Name of the auditee

Head:
Postal address of auditee:
Physical address of auditee
General telephone no.:
General fax number
Pension Contributions no.:
VAT no:
PAYE no:
Banking Details:
Bank name Type of Account Bank Account No

Other relevant information (if applicable)

1.2 Relevant Contact Persons

Name Rank and Dept Office Contact
location number

1.3 Enabling Acts Establishing the Entity

1.4 Other Regulatory Framework

Rules and Regulations:

Accounting Policies and procedures:

Accounting Framework:

1.5 Business Operations of the Entity

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Nature of the entity’s business activities:

1.6 (a) Size of Entity

Total Staff Composition:
Establishment:
Actual:
Variance:

Establishment
No. of Departments:
No. of Provincial Offices:
No. of District Offices:

1.6 (b) Size of Entity (Financial)

Expenditure budget
Original budget Provision:
Supplementary Provision:
Total Authorised Provision
Actual Expenditure:
Variance:

Funds
Actual Funds Released:
Actual Expenditure:
Variance:

Income
Total Income Budget:
Actual Collections:
Variance:

Reasons for variances:

1.7 Organisational Structure (Obtain From the Client. This will direct the
choice of audit areas)
The structure will include: Ref.doc
- Lines of authority and responsibilities
- Income and expenditure functions
- Departments
- Account Areas (budget as in Estimates of
Revenue/Expenditure
- Ministers’ briefs

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- Budget Speech

1.8 Operating Management

Ref.doc
Has the entity issued a strategic plan/business plan?
(indicating for instance goals, mission, vision and performance
indicators)

Experience and reputation of staff:

Turnover of key staff and staff in general:

1.9 Financial Performance

Financial management and budgetary control: Ref.doc

Unconstitutional and Unauthorised expenditure:

(Examine and analyse financial statements, board minutes and
management reports)

1.10 Reporting Requirements

Appropriation/Financial Statements by the auditee to be Ref.doc
included in the annual reports to be presented to Parliament

Other reports as required by Act (if applicable)

1.11 Changes With Client Since Last Audit (e.g structure, accounting
policies, enabling, Acts, management etc)
Ref.doc

1.12 Follow-Up of Prior Year Reports

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Unanswered in Management Letters/ Inspection Reports/ Audit Ref.doc

Reference Sheets

Unresolved issues in Annual and other Audit Reports

Unresolved issues in Public Accounts Committee Reports

Unresolved issues in Treasury Minutes/ Action Taken Reports

1.13 Systems Documentation Conclusion

(See1.3 Systems documentation form) Ref.doc

1.14(a) Are there any computerised systems that produce data that
affects the accounts related to the audit assignment?
List relevant systems and describe its main functions Ref.doc

1.14(b) Has the relevant systems been subject to IT audit before?

List the main conclusions Ref.doc

1.15 Control Environment Conclusion

(See 1.4 Control environment questionnaire) Ref.doc

1.16(a) Is an internal audit function established?

Ref.doc

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1.16(b) has the internal audit produced any audit reports relevant to this
assignment?
List the reports Ref.doc

1.16 (c) evaluation of internal audit functions

(See 1.5 Evaluation of Internal Audit questionnaire) to be filled Ref.doc
in if audit work will be based on internal audit work

1.17(a) Is there an audit committee?

Ref.doc

1.17(b) Are there established procedures to guide its operations and

have they been followed?
Ref.doc

1.18 Going Concern Conclusion

Ref.doc
(See 1.6 Going Concern Questionnaire)

1.19 Conclusion on Risk Assessment

Ref.doc
(See 1.1 Risk Assessment Questionnaire)

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2. AUDIT ASSIGNMENT MANAGEMENT PLAN

2.1 Personnel
Audit team Name Working days planned
Planning Exec. Report
Director

Team Leader
Rest of Team

TOTAL MANDAYS

2.2 OAG budget implications

Budget item Account Amounts planned

2.3 Time schedule/milestones for the assignment

Milestone Date planned
Submission of planning memorandum
Audit programmes finalised
Submission of file to director for review
Draft report
Updated risk assessment form
Audit assignment management report

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