In this lesson, the process of investigating results of analytical procedures is discussed, focusing on the steps to be taken when inconsistencies or fluctuations are identified. The lesson outlines the importance of inquiry, obtaining relevant evidence, and corroboration as part of the investigation process. Next, the documentation of analytical procedures is explored, emphasizing the need for clear audit records including expectation of results, factors considered during their development, and any additional auditing procedures. The lesson also covers considerations when performing analytical procedures, such as comparing an entity's financial information to prior periods, budgets, and industry information. In addition, the significance of understanding the relationships between elements of financial information and non-financial information is highlighted. Lastly, this lesson discusses the effectiveness of controls relating to analytical procedures and evaluating the precision of expectations during an audit.
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