In: Accounting
(Auditing Principles & Procedures)
List the functions of audit documentation?explan each one.
NO HAND WRITE PLZ, Thank you.
Ans:
"Documentation" refers to the working papers prepared or obtained by the auditor and retained by him in connection with the performence of his audit. Working papers should record, the audit plan, the nature, timing and extent of auditing procedures performed and the conclusions drawn.
The following are the different functions which are performed to prepare audit documentation.
1. Form, Content and Extent of Audit documentation:
a) The auditor shall prepare audit documentation that is sufficient to enable an experienced auditor, having no previous conneciton with the audit, to understand.
b) The nature, timing, and extent of the audit procedures performed to comply with the SAs and applicable legal and regulatory requirements.
c) The results of the audit procedures performed and audit evidence obtained; and
d) Significant matters arising during the audit, the conclusions reached thereon, and signigicant professional judgements made in reaching those conclusions.
2. Preparation of Working papers:
Follwing care should be taken while preparing for working papers,
3. Maintaining the Contents of Worknig papers:
4. Audit completion memorandum:
The auditor may consider it helpful to prepare and retain as part of audit documentation a summary(sometimes known as a completion memorandum) that describes the significant matters identified during the audit and how they were addressed, or that includes cross-references to other relavant supporting documentation that provides such information. Such a summary may facilitate effective and efficient reviews and inspections of the audit documentation, particularly for large and complex audits.
5. Documentation of Departures from basic principles or essential procedures:
Where, in exceptional circumstances, the auditor judges it necessary to depart from basic principle or an 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 reasons for the departure. This involves the auditor documenting below the alternative audit procedures performed were sufficient and appropriate to replace that basic principle or essential procedure.