A preliminary audit is fieldwork performed by auditors before the end of the period under examination. By engaging in this advance work, the auditors can reduce the volume of activities that must be completed after the client has closed its books, which has the following benefits:
The auditors shift work out of their core work period, when many clients want to have audits completed.
The audit staff can be kept occupied during slack periods.
The auditors can examine the books and controls for a new client, which helps them to plan for the regular audit later in the year.
There are a number of tasks that can be completed during a preliminary audit, including the following:
Examination of client controls
Preliminary analysis of account balances
Adjustment of planning for subsequent audit work, based on the first two items
No audit report is issued as part of a preliminary audit; instead, this work should be considered an early phase of the regular audit that an organization undergoes.