CH 6 - Audit Documentation
SA 230 - Audit Documentation
Audit Documentation is a record of:
Audit Procedures performed
relevant evidnece obtained
Conclusions reached by the auditor
Objective of the auditor
Auditor is required to prepare documentation that provides:
A sufficient appropriate record of the basis for the auditor's report
Evidence that audit was planned and peformed in accordance with SA and applicable and other
regulatory requirements
Nature of Audit Documentation
evidence of auditor's basis of conclusion about achievement of overall objectives of auditor
evidence that audit was planned and performed in accordance with SA
Purpose of Audit Documentation - PADRIQ
P Assist the engagement team to plan and perform the audit
D Assist to direct and supervise the audit
A Enable the engagement team to be accountable for its work
R retaining record of matters continuing significance to future audits
Q Enabling conduct of Quality control review in accordance with SQC1
Enabling conduct of external inspections in accordance with applicable legal and other
I regulatory requirements
Form, Content and Extent of Audit Documentation
Audit documentation should be prepared in such a way that it is sufficient to enable an experienced
auditor to understand:
The NTE and Audit procedures
Results of audit procedures and audit evidence obtained
Significant matters arising during the audit and the conclusions reached and the significant
professional judgements made in reaching the conclusions
In documenting NTE of audit procedures performed, the auditor shall record:
Identifying characteristics of specific items or matters testing
Who performed the audit work and date such work was completed
Who reviewed the audit work and date and extent of review
Documentation of Significant Matters and Related Significant Professional Judgements
Examples of Significant Matters
Matters that give rise to significant risks
Results of AP which indiencate FS could be matterially misstated or result in revision of ROMM
Significant difficulty in applying necessary audit procedures
Findings that could result in modification
Documentation of Professional judgements made serves to explain the auditor's conclusions and to reinforce the
quality of judgement
The Auditor shall also document discussions of significant matters with Management and TCWG
If auditor identified ifnromation that is inconsistent with final conclusion. He shall document how he addressed
the inconsistency
Factors Affecting Form, Extent and Content of Audit documentation
Size and complexity of the entity
Nature of audit procedures to be performed
ROMM
significane of audit evidence obtained
Nature and extent of exceptions identified
Need to document a conclusion or a basis for a conclusion
Audit methodology and tools used
Timely Preparation of Audit Documentation
To prepare audit documentation on a timely basis
This helps to enhace the quality of the audit and effective review
To assemble the final audit file in not more than 60 days from the date of auditor's report - SQC1
Completion of assemble of final audit file is an administrative process and does not involve performance of new
audit procedures
The following changes can be made:
Deleting, discarding superseeded documentation
Sorting, collating and cross referencing
Signing off on completion checklist
Documenting the Audit evidence obtained, discussed and agreed before the date of audit report
Retention Period
No Shorter than 7 years from Date of Auditor's Report or group audit report whichever is later as per SQC1
Audit File
One of More folders or other storage media containing records that comprise the audit documentation is called as
Audit File.
Completion Memorandum
Auditor May consider to retain a summary that describes
The significant matters
how they were addressed
Such a summary may facilitate effective and effiecient reviews and inspection
May assist the auditor in consideration of sigificant matters
Ownership
SQC1 provides that unless otherwise specified by law or regulation, audit documentation is the property of the
auditor
The auditor may at his discretion, make portions of, or extracts of audit documentation available to the clients,
provided:
Such disclosures does not undermine the validity of the work performed
Does not undermine the independence of the auditor or his personnel
