Disadvantages of Continuous Audit
In spite of many advantages of continuous audit, it has certain drawbacks, which are discussed as under.
1. Alteration of Figures
In case of continuous audit, the auditor checks the books of accounts in several visits. There is a possibility that the figures maybe altered and client’s staff may tamper books of accounts after the auditor has checked them on previous days.
2. Dislocation of Client’s Work
The frequent visits of the auditor may cause inconvenience to the staff of the business and the office routine may be dislocated.
3. Continuous Audit is Expensive
Continuous audit may not be suitable for small scale concerns because it involves lot of time, effort and money.
4. Losing the Continuity of Work
In continuous audit the audit work is not carried out at one time. So the auditors may lose the thread of work and may fail to seek clarifications of the queries arise in the previous visit.
In other words, queries and doubts, which arise at one sitting of the auditor and left over for clearance at next sitting, may be overlooked. He may not be able to pick up the work from the point where he left it at the previous audit session.
5. Unhealthy Relationship
Frequent visit of audit staff is likely to establish an unhealthy relationship between the audit and the client’s staff. Hence the moral check upon them may be lessened.
Under the continuous audit, the work of the auditor becomes mechanical and auditor’s frequent visit may also lead to monotony in work.