I am new to the auditng world and need some info on auditing loan loss reserve areas of community banks. I just don't know where to begin. Thanks!

Sarah, do you have experience with any facet of calculating the loan loss reserve? Lending or credit quality in general? If not, being new to auditing and/or community banks will render this a very difficult area to audit well.

At the least, you'd want to see that management is conducting at a minimum, a quarterly analysis (should probably be monthly), that their inputs track to historical loss results by portfolio segment, that the analysis uses both FAS 5 and 115 methodology... you'd want to compare system-generated past due data to the assumptions included in management's analysis. See that the watch list/substandard, doubtful, and loss loans are accurately identified in the analysis....

That's what comes to mind off the top of my head. Maybe some other folks can chime in...

Go to the examiner's handbook for your primary federal regulator and see what they're told to look at.