Unlocking the Future of Audit: Group Audits, Central Planning and Next-Level Data Analytics 

Unlocking the Future of Audit: Group Audits, Central Planning and Next-Level Data Analytics 

Audit is changing rapidly. Standards are tightening, expectations are rising and technology is reshaping what good audit work looks like. Recent updates to Mercia’s methodology – now reflected within Caseware’s audit platform – help firms keep pace. 

For UK audit practices the updates fall into several key areas: 

• Stronger component audit procedures under ISA (UK) 600 

• A more streamlined way to manage group audits 

• New supplementary forms to address tariff-related risks and emerging technologies 

• A more modern approach to audit data analytics 

• Greater flexibility in sampling and handling client data 

• Central planning tools to drive consistency across engagements 

Here’s a clear and practical round-up of what’s new, what’s useful and what it means for your audit work. 

1. Component audit best practice under ISA (UK) 600 

Revisions to ISA (UK) 600 mean group audits now require a more thoughtful, risk-based approach to components. Rather than simply treating each subsidiary as a self-contained box to be ticked, auditors are expected to understand and document how each component contributes to the risks of material misstatement at group level. 

Mercia’s updated methodology reflects this shift and Caseware now supports it through a clearer structure for documenting each external component auditor. 

One set of documents per component auditor 

Instead of completing one generic form that covered all component auditors, firms now create individual documents for each one. This includes: 

• PF1-9 (Permanent information) – key details about the component auditor and their involvement. Creating this generates linked documents at planning and completion. 

• B26 (Planning) – how the component auditor will participate, what they’ll cover and how their work fits into your group-level risk assessment. 

• A53 (Completion) – your review of their work, whether documentation was timely and whether their input is sufficient for group reporting. 

This ensures the group auditor’s oversight is properly documented and that reliance on component auditors is transparent and defendable. 

These enhancements are already available across Mercia-based Caseware templates that include group audit functionality – including UK Company, ROI Company, International, LLP, Charity and Academy. 

2. Group audits: One engagement per opinion, all components connected 

Caseware’s group audit structure allows the entire group audit to be managed within one engagement file (one audit opinion). You can: 

• Build a full group hierarchy (group and components – including parent, subsidiaries, sub-subsidiaries and specific components) 

• Import separate trial balances for each component 

• View accounts at group level or filter down to individual entities 

Assigning work to components 

From the group file, you can allocate: 

• Risks and Controls; 

• Specific documents; or 

• Specific procedures within documents 

to each component. Component auditors complete their work in their associated files, and the group file shows whether items are completed or awaiting review. 

Risk assessment stays with the group auditor, as required by ISA (UK) 600, but components can still receive the work they need to perform. 

Reusing work for separate statutory audits 

If a component also has its own statutory audit, you can: 

• Copy completed documents (such as stocktake observations) from the group or component engagement into that entity’s file 

• Bring across relevant risks and controls 

This avoids duplication and ensures work performed once can support multiple audit opinions where appropriate. 

3. A modernised approach to audit data analytics (ADA) 

Mercia has updated its methodology around audit data analytics and these changes are already reflected in Caseware’s Company Audit template, with other templates following as updates are released. 

Deciding when ADA is applicable 

A new standard question prompts auditors to consider whether ADA is relevant to the engagement. If it is, a dedicated ADA planning document guides you through: 

• Whether ADA will be used at all 

• Which areas it will apply to (e.g. preliminary analytics, journal entry testing, sampling, specific assertions) 

Users’ choices determine which ADA-related documents appear later in the file. 

ADA now integrated directly into audit programmes 

Within the B40 audit programmes, each audit area now asks: 

“Do you want to use audit data analytics in this audit area?” 

If so, the relevant ADA documents become available. Mercia has enhanced its existing journal-focused ADA documents and added new ones for cash and bank, as well as a generic version for other areas. 

Choosing risk criteria and running analytic tests 

The ADA documents let you: 

• Select risk criteria (e.g. large or unusual values, rounded amounts, transactions ending “999”) 

• Apply risk enhancers 

• Decide whether to use external ADA tools or manual risk-based ADA 

• Click through to run analytic tests directly from the procedure 

A small icon next to certain procedures allows you to open Caseware’s Analytics Hub, where you run the tests and review the results. 

Firms can set defaults at a firm-wide level – for example, treating certain areas as inherently higher risk – and then refine them at engagement level. 

General Ledger Completeness 

When importing a general ledger for use with enhanced analytic procedures it is important to ensure the general ledger is complete. 
 
This feature ensures that opening and closing trial balances are reconciled to the general ledger, indicating where differences occur and providing assurance that the numbers being reviewed are accurate and complete. 
 

4. Analytics Hub: Making data work for the audit 

The Analytics Hub is where ADA becomes practical. It supports multiple data types, including: 

• Trial balance 

• General ledger 

• Accounts receivable (customers, balances, invoices, cash receipts) 

• Accounts payable (suppliers, balances, invoices, payments) 

• Inventories 

• A flexible “Other” category for structured datasets such as fixed asset registers 

Once uploaded, you can run multiple ADA tests at once and quickly see the results. An aggregate results screen shows: 

• Which tests each transaction triggered 

• The status of each item (investigated, queried with client, flagged, cleared) 

• Export options for attaching results back into the file 

The result is a more efficient, better-documented and more transparent approach to risk-focused auditing. 

5. More flexible sampling with the “Other” schema 

To support more real-world client datasets, firms can now upload almost any structured spreadsheet under the “Other” schema. Once you map the columns (dates, text, values, etc.), you can use Caseware’s sampling tools to create: 

• Random samples 

• Filters (e.g. values over a threshold) 

• Customised selections based on audit objectives 

This means you can sample from a dataset such as a fixed asset register without forcing it into a predefined format. 

6. Extractly: Turning PDFs into usable audit evidence 

As more clients provide evidence digitally, firms often face large volumes of PDFs – invoices, statements, schedules and so on. Extractly helps bridge this gap. 

Working inside Excel, Extractly allows you to: 

• Use text or table extraction tools 

• Automatically extract data from large batches of similar PDFs using templates 

For example, you can tell Extractly: 

“From each invoice, extract the date, amount, supplier name and invoice number.” 

It will then process hundreds or thousands of invoices and produce a single clean table in Excel. 

This allows for: 

• Faster matching to sample selections 

• Larger sample sizes 

• Better coverage and richer audit evidence without increasing manual effort 

7. Central planning: Consistency and efficiency across engagements 

Central planning is designed for firms that run multiple engagements with similar planning requirements – for example, large portfolios of similar SMEs or groups of related entities. 

How it works: 

1. Set up a centrally planned file 
   Complete your planning documents, risks and controls once. 

2. Mark which documents are centrally planned 
   These become controlled at the central level. 

3. Create new engagements linked to the central file 
   They automatically inherit the centrally planned documents. 

4. Synchronise updates 
   If anything is updated centrally, linked engagements can accept those changes through a central planning panel. 

This promotes consistency, reduces duplication and helps maintain audit quality across many similar files. 

Final Thoughts 

Across all of these developments, two themes stand out: 

• Audit quality – better documentation, clearer rationale and stronger links between risk, evidence and conclusions. 

• Efficiency – fewer repeated steps, smarter use of data and better coordination across related engagements. 

Whether you’re a sole practitioner handling a few small groups or a larger practice working with complex multi-entity structures, these changes in Mercia’s methodology and the supporting tools within Caseware can help make your audits more robust, more efficient and more aligned with the expectations of today’s regulators. 

Get in touch with Caseware to see how we can help unlock the future of your audits!