Laserfiche WebLink
AUDIT <br />PROCESS <br />Smith Schafer has significant experience relating to the tr sition of accounting as the successor <br />acco t. t. We strive to make the transition smooth for our clients and pride ourselves in <br />perfor g this process professionally and with courtesy as it relates to working with <br />orgzation's predecessor accountant. First-year costs, related to file set-up, transition and <br />comm ication and other out-of-pocket expenses, will be absorbed by Smith Schafer and are not <br />included in the fees comm icated in the price section of this proposal. <br />Audit Planning <br />Smith Schafer is proactive in our planning approach. The goal in this phase is to gain a thorough understanding of your internal controls, processes <br />and procedures. We identify most potential problems before the audit and thus are able to resolve issues that might otherwise impede the engagement. <br />We utilize our planning conference to review standard changes impacting the current audit. At Smith Schafer, we emphasize planning in order to <br />ensure an audit engagement with a minimal level of disruption to the City of Lauderdale staff. The planning phase will be performed by the Principal <br />and Manager. During this phase we will: <br />Assess current year activity. <br />Review expectations of client assistance. <br />Develop a schedule for the completion of the audit fieldwork and reporting phases of the engagement. <br />Perform preliminary materiality determinations and risk assessment. <br />Perform preliminary assessment of fraud factors. <br />Assess control risk. <br />Determine type and extent of substantive transaction and analytical review testing based on assessed level of control risk. <br />Make inquiries of management and other employees regarding fraud in accordance with Auditing Standards. <br />This is an excellent time for the City of Lauderdale personnel to resolve any questions they have regarding the audit. The value in hiring our firm <br />comes from not only the audit, but from our experience with your organization and the education we can provide. As questions and concerns arise <br />throughout the year, we encourage the City of Lauderdale personnel to contact us and draw on our knowledge and experience. <br />AUDIT FIELDWORK PHASE <br />We assess risks, design procedures and obtain evidence to support financial statement amounts and disclosures during fieldwork. We utilize a <br />methodology designed for governmental units. Our process emphasizes continuous communication and training with your staff. The audit fieldwork <br />phase will be performed by all members of the engagement team. During this phase we will: <br />Document and test internal accounting controls through review of accounting procedure manuals and discussion with the City of <br />Lauderdale. <br />Update depreciation records for capital asset additions and retirements, as necessary. <br />• Review account reconciliations and related detail. <br />• Test the propriety of all material account balances. <br />• Perform substantive testing of transactions of selected accounts, sample sizes to be based on assessed level of control risk. <br />• Obtain permanent file documentation. <br />Perform general audit procedures including compliance questionnaires and management inquires. <br />3 <br />