Learn how clearly defined objectives allow federal auditors to limit the scope of work, reduce cycle time, and produce timely results. Scope is inseparable from objectives, and narrowing both helps ensure the audit remains feasible without compromising evidence standards.
This lesson is a preview from Graduate School USA's Quick Response Auditing Course.
Relationship of Scope to Objectives
There is an inextricable link between objectives and scope, maybe methodology,
- Scope can be thought of in terms of: “ . . . how much do I need to look at to answer the question . . . “
- The scope of the audit must be adequate to answer the objective(s)
- If objectives are narrow, scope will naturally be limited
- Auditors must resist the urge to expand the scope unless there are compelling reasons that arise during the audit
“Scope is the boundary of the audit and is directly tied to the objectives.” Par 8.10
Audit Scope
- Time period of operations
- Number of locations
- Number of transactions
- Number of people or interviews
Limiting Scope: Time Period of Operations
A direct correlation exists between the period of operations audited and the amount of field work: timeliness
- Ideal objective(s) should render the time period self-evident
- Scope should correlate directly to objective(s): one quarter, one year, etc.
If the scope is to be limited further, consider refining the objective(s).
“Reviewed the Department’s ‘on time’ performance records for the past six months.”
Limiting Scope: Number of Locations
A direct correlation exists between the number of locations, divisions, or units audited and the audit cycle time.
- Ideal objective(s) should render locations, divisions, or units self-evident
- Scope should correlate directly to objective(s): question(s) about operations at specific locations
“Reviewed last year's on-time performance records in the Northeast and Southwest Regions.”
If the cope is to be limited further, consider refining the objective(s)
“The scope defines… the necessary documents or records, the period of time reviewed, and the locations that will be included.” Par 8.10
Limiting Scope: Number of Transactions
A direct correlation exists between number of transactions, files, or documents reviewed and audit cycle time.
- Ideal objective(s) should facilitate limiting the population to be reviewed
- The population is generally linked to locations and time period as well
- The population can be further limited through sampling
Limiting Scope: Number of People/Interviews
A direct correlation exists between the number of interviews and audit cycle time.
- Ideal objective(s) should facilitate the identification of officials or operating personnel to be interviewed
- The number and extent of interviews should generate sufficient, competent, and relevant evidence to answer the objectives
If warranted, limit interviews by:
- Refining objectives or sub-objectsives
- Conducting interviews on a sample basis
Audit Scope: Considering Design Constraints
As discussed, objectives have a direct bearing on audit scope. However, additional constraints may require a scope limitation:
- Resources: What level of resources are available?
- Staff expertise: chronological and functional experience
- Physical Access
Resource Considerations
Government audit resources are typically constrained. Quick responses are often needed when resources are unavailable.
Quick responses can still be provided by:
- Limiting audit objectives
- Limiting audit scope
- Selecting locations or times where auditors are available
- Leveraging functional experts
Expertise Limitations
Some quick responses require expertise beyond that resident in the organization. Strategies must be developed to cope with such constraints. Responses can still be provided quickly by:
- Limiting audit objectives to subjects with resident expertise
- Limiting audit scope to correspond to resident expertise
- Leveraging the expertise
Physical Limitations
In some instances, quick responses are required where physical access is limited or time-consuming. Critical audits can still be accomplished by:
- Sampling or testing a limited number of remote facilities or locations
- Relying on the work of others
- Outsourcing a portion of the field work
- Refining objectives or sub-objectsives to limit scope
