Another statutory requirement states that the auditor must examine the accounts, dockets, and records of the county and district clerk, justices of the peace, constables, sheriff, and tax assessor-collector. The law does not, however, specify the frequency of these examinations or their scope. Other statutory responsibilities require the county auditor to prepare a budget covering the county's proposed expenditures for each fiscal year and to keep a general set of records showing all transactions relating to county accounts, contracts, indebtedness, receipts, and disbursements. All these responsibilities make it difficult for county auditors to complete their legally required assignments while finding time for still other audits that should be conducted due to the risk involved in various county functions. One step that can help to ensure that county audit resources are used effectively is the preparation of an audit plan at the beginning of each year using a risk assessment to set priorities.
Risk assessment is a systematic analysis of probable adverse conditions and events.
Risk factors weighed through this assessment can include statutory requirements, asset size, liquidity, transaction volume, complexity of activities, degree of computerization, and the date and results of previous audits. Frequently, the status of previous audit recommendations can be a useful source of information on risk because they demonstrate whether management has made good-faith efforts to resolve problems already identified. The audit plan is a proposed work schedule. It should be prepared annually and based on the results of a risk assessment and the auditor's professional judgment. Generally, the internal auditor should assign a higher priority to activities with a higher risk.