What Is an Alt Code?

The alternative audit procedure is that the procedure identified by the original (understanding of the audited entity and its environment) cannot be performed. In order to achieve the same audit objective, the CPA must perform another procedure.

Alternative procedure

Right!

The alternative audit procedure is that the procedure identified by the original (understanding of the audited entity and its environment) cannot be performed. In order to achieve the same audit objective, the CPA must perform another procedure.

For example, due to objective reasons (weather changes), the CPA cannot perform the supervision procedure, and should perform alternative procedures, including checking the original vouchers such as the receipt and delivery vouchers of the related inventory. Although this procedure is not as effective as direct supervision, it should also be implemented. Or the procedures that have already been performed cannot achieve the audit objectives, the CPA should also implement alternative audit procedures. For example, by performing a variable sampling test, it is found that the inferred overall error is too large, and the CPA no longer trusts the sampling results. For audit objectives, the CPA may perform more detailed ^[1] substantive procedures.

use:

The replacement audit procedure is invalid. The CPA must perform other procedures to replace the original planned procedure. The replacement procedure changes the nature of the planned procedure.

Generally, only when the involved misstatement exceeds the degree approved by the CPA, such as the aggregate misstatement exceeds the level of materiality at the reporting level, or the fraud and violation of laws and regulations are extremely significant, the CPA needs to expand the scope of the audit, thereby Reduce overall audit risk to acceptable levels;

If the established audit procedures cannot be implemented or the implemented audit procedures cannot achieve the established audit objectives, the CPA should consider implementing alternative audit procedures.