AUDIT DOCUMENTATION

AUDIT DOCUMENTATION

 Audit documentation may be recorded on paper, or

electronic, or other media. Example of audit
documentation includes:
 Audit programs.
 Analyses.
 Issues memoranda.
 Summaries of significant matters.
 Letters of confirmation and representation.
 Checklists.
 Correspondence (including e-mail) concerning significant matters.
AUDIT DOCUMENTATION

 The auditor should prepare the audit

documentation so as to enable an
experience auditor, having no previous
connection with the audit, to understand:
 The nature, timing, and extent of the audit
procedures performed to comply with PSAs
applicable legal and regulatory requirements.
 The results of the audit procedures and the
audit evidence obtained; and
 Significant
matters arising during the audit
and the conclusions reached thereon.
AUDIT DOCUMENTATION

 In documenting the nature, timing and

extent audit procedures performed, the
auditor should record the identifying
characteristics of the specific items or
matters being tested.
 The auditor should document the
discussions of significant matters with the
management and others on a timely basis.
AUDIT DOCUMENTATION

 Where, in exceptional circumstances, the

auditor judges necessary to depart from
basic principle or a essential procedure
that is relevant in the circumstances of
the audit, the auditor should document
how the alternative audit procedures
performed achieve the objective of the
audit, and, unless otherwise clear, the
reason for the departure.
PSA 230
AUDIT DOCUMENTATION
 Experience auditor – an individual who
has practical audit experience, and
reasonable understanding of:
 audit process;
 PSAs and applicable legal and regulatory
requirements;
 The business environment where the
business operates; and
 Auditing and financial reporting issues
relevant the entity’s industry.
AUDIT DOCUMENTATION

 The auditor should record:

Who performed the audit work and
the date such work was completed;
and
Who reviewed the audit work
performed and the date and extent
of such review.
Content of Audit
Documentation
Audit documentation should:

Include the overall audit

strategy and audit plan.

Enable an experienced auditor

to understand:

The nature, timing, extent, The results of audit

and results of the audit Procedures and evidence
procedures performed to obtained, and conclusions
Comply with PSAs and reached on significant
applicable regulations . matters.
Content of Audit
Documentation

Most audit firms maintain

audit documentation in two types of files

Permanent files Current files

Corporate charter Important contracts

Chart of accounts Internal control documentation
Organization chart Terms of stock and bond issues
Accounting manual Prior years’ analytical procedures
Content of Audit
Documentation
Most audit firms maintain
audit documentation in two types of files

Permanent files Current files

Overall audit strategy Adjusting journal entries

Audit plan, Audit report Reclassification journal entries
Working trial balance Current financial statements
Minutes of meetings Working papers supporting
accounts
Assembly of the final audit file
 The auditor should complete the
assembly of the final audit file on a
timely basis after the date of the
auditor’s report. As PSQC1 indicates,
60 days after the date of auditor’s
report is ordinarily an appropriate
time limit within which to complete
the assembly of the final audit file
Assembly of the final audit file
 Retention of engagement
documentation under PSQC 1 requires
firms to establish policies and
procedures for the retention of
engagement documentation.
 The retention period for audit
engagements ordinarily is no shorter
than five years from the date of the
auditor’s report, or, if later, the date of
the group auditor’s report.