Preparing for an audit is essential to ensure a smooth and successful auditing process. The following are the preparatory steps that need to be taken before the commencement of an audit:

1. Establish the audit objectives: The first step in preparing for an audit is to define the audit objectives. This will help determine the scope and focus of the audit.

2. Determine the audit team: The next step is to decide who will conduct the audit. The audit team should be composed of qualified and experienced professionals who can carry out the audit effectively.

3. Conduct a risk assessment: It is important to assess the risks associated with the audited entity. This will help the audit team identify areas of potential risk and focus their efforts accordingly.

4. Obtain necessary documents: The audit team should obtain all the necessary documents related to the audit, including financial statements, internal control reports, and other relevant documents.

5. Schedule the audit: The audit team should work with the audited entity to schedule the audit at a mutually convenient time.

6. Communicate with management: The audit team should communicate with management to inform them of the audit objectives, scope, and timing.

7. Plan the audit approach: The audit team should plan the audit approach, including the procedures to be followed during the audit, and identify the key audit risks.

8. Perform preliminary analytical procedures: The audit team should perform preliminary analytical procedures to identify any unusual trends or patterns in the financial statements.

By taking these preparatory steps, the audit team can ensure that the audit is conducted effectively and efficiently.