Agenda 03-01-22; 8-a - Minutes - Laserfiche WebLink

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4 1 Slide #3 Dole of the External Auditor Actions Require Procedures Ffnarclal Statements, Management •Obtain_ y misstatement - t AT t f-- _M0111111111 %.%Cherry Bekaert- 2 3 Mike Carey continued the presentation. He said Cherry Bekaert uses a risk-based 4 approach in planning the audit. He said that includes review of prior year adjustments, annual 5 reports, inquiry with management, preliminary analytics and a review of industry trends in North 6 Carolina. He said that the information is used to assess areas of significance in the county's 7 audit and to develop Cherry Bekaert's risk assessment. He said that based on the risk 8 assessment, the team then develops the audit approach and testing procedures. He said that 9 the procedures are used to obtain reasonable assurance of the audit results not absolute 10 assurance. He explained that based on the test, they draw conclusions that the annual report is 11 free from material misstatements or if adjustments are required. He said that after the audit is 12 performed, they develop opinions based on components of the county's annual report, internal 13 controls over financial reporting, and internal controls over county's compliance with reporting 14 on federal and state program funding. He said that certain components are included based on 15 required communications and that those are contained in the governance letter for the audit. 16 17 Slide #4 Internal Controls jjgE�ficant Cycle- I est of Controls information ,.. .112:- Con" CherryBeti�_rl 19 Mike Carey said that part of risk assessment process identifies certain audit areas to 20 gain an understanding of internal control processes. He said that once that is done, they 21 complete a "cradle to grave" walk through of any significant audit area.