Risk-Based Audit Planning
Risk-based audit planning prioritizes the high-risk areas of an organization so as to maximize the effectiveness of the audit. By focusing on areas with the greatest potential for financial loss, compliance issues, or operational inefficiencies, auditors can proactively identify vulnerabilities and support management in making informed decisions. This section covers the following aspects of risk-based audit planning:
- What is risk?
- Vulnerabilities and threats
- Inherent risk and residual risk
- The advantages of risk-based audit planning
- Audit risk
- The steps of the risk-based audit approach
- The steps of risk assessment
- The four methodologies for risk treatment
What Is Risk?
Most of the CISA questions are framed around risk. Therefore, CISA candidates should have a thorough understanding of the term risk, which has multiple definitions/formulas. If you look carefully, every definition speaks either directly or indirectly...
