UK Accounting Glossary
Analytical review is an auditing procedure that uses ratios to determine whether any significant changes have taken place.
An analytical review is a auditing test used to gather evidence of the validity, completeness and accuracy of financial statements and accounting records. Analytical review is a kind of substantive test which can b used in the planning of, or undertaking of an audit. Analytical review works by comparing data, figures, financial and non-financial data, either externally or internally to determine whether said data and figures are reasonable. The procedure used may vary, it could simply be a comparison of data, for example comparing the amount held in a current account with that held in the same current account last year. Or it could be a more sophisticated procedure which uses computer auditing software as well as advanced statistical procedures, for example, using multiple regression analysis.