pls help - difference walkthough and testing? 2555
tomdadom last edited by
can someone help me to understand the difference between walkthrough and testing?
Is the difference that during walkthrough I have to go through the whole process and in testing just to test (see evidence) if the control was performed?
In particular I have to make a walkthrough (compare flowcharts, narratives with the documantation) for a rather complicated process, and I do not know what I have to test afterwards (if the walkthrough is o.k. and also evidence is delivered).
Appreciate any comment…
Thx in advance…
kymike last edited by
A walkthrough is basically sitting down with a process performer(s) and having them take you through a process from beginning to end. This is helpful when documenting a process or reviewing process documentation to show that you understand how the process works and that it is documented correctly.
A walkthrough will also help you to identify potential segregation of duties conflicts that will need to be resolved or have compensating controls identified.
A walkthrough is generally only completed once per year. Testing will entail pulling samples of the identified controls - sample sizes should be based on how frequently a control operates and the risk to the financial statements should a control fail to catch an error - from throughout the year.
It sounds like you are doing this in an environment where the processes and controls have been previously documented. If so, you should also be provided with a list of key controls that will need to be tested. They should address the critical ‘what could go wrong’ risks in the process. You will want to ensure that you know who performs each control, how frequently it is performed and how it is evidenced that the control was performed. Armed with this information, you should then be able to test the control for operating effectiveness.
tomdadom last edited by
Thanks a lot.
WrightLot last edited by
KYMike is correct.
My team when undertaking a walkthrough will randomly select a transaction at the start of a process and follow it through all the way into the final financial statements. In so doing they confirm the accuracy of the process flow charts and the validity of the identied risks and controls (as the walkthrough will by definition test each key control once).
My external auditors love this because if documented and evidenced properly they can rely heavily upon it.