Despite having completed most of the interim work, Jasper Parsons left without preparing a time budget for the audit. The partner in charge has asked you to prepare this budget for the current year's engagement. Form P-1 has the actual hours expended in the previous year. Last year the auditors attempted to save time by cutting the hours allotted for planning and interim work. As a consequence, the audit team had to perform additional year-end work and expended a great deal of overtime due to unforeseen circumstances. These eventualities could likely have been avoided had the team spent more time during planning, and at interim. The partner-in-charge would like to reduce the total time for this year's audit to 200 hours while avoiding the pitfalls encountered in the previous year. She believes this is possible if certain modifications are made.

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ANSWER The audit time budget is an estimated time allocated to the implementation of audit assignmen... View the full answer