Due to the nature of audit, the workload can vary greatly depending on the type of clients that you are assigned (i.e. your industry selection and private vs. publicly traded).
The audits of large public clients typically drive the “normal” busy season of January – March. However, an auditor who specializes in another industry may have a different busy season.
The summary below reflects an associate assigned to a Publicly Traded client with a 12/31 year-end.
March – April
At this time, we are completing Risk assessment and planning procedures. Basically, we are setting up and planning for the year’s audit by ensuring we’re in compliance with independence rules and client acceptance procedures. We are also considering significant risks or fraud risks as they relate to new changes within the industry environment or changes specific to the client.
May – August
During the summer months, it is more relaxed with most of our time spent performing and documenting walkthroughs, as well as testing controls of our clients’ key processes. Our days are spent in meetings with client personnel to discuss their roles in key processes and testing the controls that exist to prevent/detect misstatements.
September – November
As we approach the client’s year-end, we are completing and fine-tuning our testwork over the client’s internal control environment, and may begin performing interim substantive procedures.
Substantive procedures are procedures that we perform to test the balances that exist on the financial statements as of the client’s year-end, and may include sampling procedures, trend analysis, confirmation of balances with external parties, etc.
We may consider control deficiencies (an instance where controls are either designed inadequately or not performing correctly) that were identified during our testing and the impact of the deficiency on our substantive procedures.
If we find that there are deficiencies, our assessment of the risk over accounts payable becomes higher, ultimately leading to more pervasive evidence needed to support that the account is indeed accurate. The nature, timing, and extent of procedures must be altered to account for the greater risk.
This is usually a slower time due to approaching holidays. It is mainly spent on cleaning up Audit Files, wrapping up interim substantive procedures, as well as setting-up for year-end substantive procedures.
January – February
This time is known by many auditors as “busy-season,” as it is busier than the other parts of the year. We must complete a majority of our substantive procedures over the year-end balances at this time and work closely with client personnel to gain an understanding of the documentation provided to support these balances.
Days during this time go by quickly because you are working on many different tasks at once, but you also learn a lot and quickly develop better time management and communication skills. You work through the client’s filing date, with a few days spent after that date for only clean-up of documentation.
*Note that, for public clients, quarterly reporting needs are also a relevant task – each quarter is subject to review procedures, which can be equated to a “mini-audit”. These procedures typically span two to three weeks in the months following quarter-end.
** The views expressed by the author are their own and not that of their employer or other party.
Paige Harrell is a Senior Audit Associate at KPMG. Connect with her on LinkedIn.