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Audit Documentation

The document discusses audit working papers, which are documentation created and obtained by auditors during an audit. They provide evidence to support the audit opinion and show that auditing standards were followed. Working papers should be sufficiently detailed to give an overall understanding of the audit. They may be paper-based or electronic. Auditors must document important matters related to evidence, judgements, and compliance with standards. Working papers are owned by the auditor but may only be shared with third parties with client consent.

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Joseph Simudzirayi
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32 views11 pages

Audit Documentation

The document discusses audit working papers, which are documentation created and obtained by auditors during an audit. They provide evidence to support the audit opinion and show that auditing standards were followed. Working papers should be sufficiently detailed to give an overall understanding of the audit. They may be paper-based or electronic. Auditors must document important matters related to evidence, judgements, and compliance with standards. Working papers are owned by the auditor but may only be shared with third parties with client consent.

Uploaded by

Joseph Simudzirayi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Documentation

AUDIT WORKING PAPERS


ISA 230 Documentation
• states that the auditor “should document matters which are
important in providing evidence to support the audit opinion
and evidence that the audit was carried out in accordance
with International Standards on Auditing.
• Working papers should be “sufficiently complete and
detailed to provide an overall understanding of the audit”.
• Working papers maybe be in the form of data stored on
paper, electronic media, film and etc
• Documentation means being working papers prepared by or
obtained or retained by the auditor in connection with the
performance of the audit
• The auditor should document matters which are important in
providing evidence to support the audit opinion and
evidence that the audit was carried out in accordance with
ISAs
• Working papers may be in the form of data stored on paper,
electronic media, films etc.
• Working papers are there to support the auditor’s opinion
• They also support the auditor’s compliancy to ISAs
Is the record of:
• The planning and performance of the audit
• Supervision and review of the audit
• The audit evidence resulting from the audit work
performed which the auditor considers necessary and
on which they have relied on to support their opinion
The auditor should record in the working papers
information on planning the audit work, nature and type
of audit extent of the audit procedure, the result thereof
and the conclusions drawn from the evidence obtained.
• The extent of working papers is a matter of professional judgement
and it is neither necessary nor practical to record every matter.
• Auditors are required to record all matters which are important in
supporting the report and in particular on all significant matters that
require the exercise of judgement. They are also there to support ISA.
• Working papers should not be made available to third parties without
the client’s consent and extracts from the working papers can be
made available to the client entirely at the discretion of the auditor.
• Appropriate procedures should be undertaken to maintain the
confidentiality and safe custody of working papers and for their
retention for a sufficient period to meet regulatory requirements –
about six (6) years.
•The auditor should record in the
working papers info on planning the
audit work, nature timing and
extent of the audit procedures, the
results therefore and the conclusion
drawn from the evidence obtained.
Contents of working papers
(a) Information likely to be of continuing importance on recurring audits such as the
Organisation’s constitutional documents and other information concerning the legal and
Organisation structure of the entity.
(b) Audit planning information and time budgets.
(c) Details of the internal control and accounting systems of the business including the
Auditor’s evaluation and assessment of risk.
(d) Details of audit work carried out, including notes of errors, action taken and
conclusions drawn, including work carried out by other auditors.
(e) Supporting schedules to financial statements.
(f) Audit conclusions including significant and unusual matters.
(g) Copies of approved financial statements and auditor’s reports, letters of
representation, engagement letters, and letters of weakness.
Audit working papers are
usually filed in two separate files:

(a) Permanent files

(b) Current file


 
Permanent Audit File
Contains copies of the company’s founding documents and other appropriate statutory and legal
regulations, these include
• Letters of engagement
• Minutes if important board and general meeting
• Mortgages and charges
• Title deeds of freehold and lease hold properties
• Trade agreements
• Agreements for licenses and royalties
• .copies of previous financial statements (description of the nature of the organization, market
structure, product, location, extent of product etc.)
• Organizational charts with extra detail for the finance department
• List of main accounting records
• Copies of previous management reports
• List of the client’s investments
Current audit file
The current audit file mainly relates to the financial statement/ accounts
being audited
It contains :
• Copies of accounts or statements
• Checklist concerning compliancy with statutory provisions
• Working papers created to show the results of tests and evaluation of
systems, records of control weakness and actions taken
• Schedules showing the results of audit tests carried out on transactions
and balances
• A record of minutes of meetings of the directors and shareholders
• Completed audit program
Ownership and custodian of Working
papers
• The auditor should adopt appropriate procedures for
maintaining the confidentiality and safe custody of
working papers and for retaining them for a period
sufficient to meet the needs of the practice and in
accordance with the legal and professional requirements
of record retention
• NB the auditor’s working papers are his own property as
he created them in an independent capacity and his own
use

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