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Hello.
I find myself always confused between test of details and analytical procedures. Can anyone kindly explain the differences? Thanks.
Analytical is camparison with financial r non financial information , substantive is detailed working of items already performed by management
Analytical procedures consist of comparisons of amounts and ratios. No detailed transactions are involved.
Tests of detail are procedures such as inspecting lots of invoices and tracing them to various accounts, tracing cash received and paid form the cash book to the porper account etc. Detailed transactions are verified.
Two types of tests TOCs & TOD/ Substantive tests. Under TOD you do APs. To add on to what MR Keymaster has said. I think you have to realise that APs are used as pointers to identify where further work needs to be done eg when you reculculate stock days cover and produce 50 days when managements said they keep two weeks inventory then you have to obtain futher evidence on inventories APs are performed at: 1. Planing Stage of Audit as a means of identifying high risk areas to minimise detection risk (DR) 2. At the auditing stage as part of substantive test proceedures 3. Review Stage as means of checking overal reasonableness of the finstats in light of other corroborating evidence
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