Audit documentation does not normally include the Study with Quizlet and memorize flashcards containing terms like What are the following areas require documentation related to the auditor's risk assessment and response?, If management chooses not to eliminate an identified material misstatement, appropriate audit opinions include _____. Explore quizzes and practice tests created by teachers and students or create one from your course material. Audit documentation should include: Audit Programs Documentation of Control Risk Client Representation Letter a. Process models. 2. The auditor must prepare audit documentation, on a timely basis, in sufficient detail to provide evidence: a) About the conclusions reached; and b) that the audit was planned and Audit documentation does not normally include the specific assertions under audit. Industry accounting guides. Documentation is not merely about recording facts; it’s about weaving a narrative that captures the essence of the audit process. 6 Form and content of documentation. 18. A60-A63) Retention of Engagement Documentation (Ref: Para. If the external auditor uses specific work of the internal auditors, the external auditor shall include in the audit documentation the conclusions reached regarding the evaluation of “Audit Documentation,” paragraphs 8–11, and A6. The auditor need not include in audit documentation superseded drafts of working papers and financial statements, notes that reflect incomplete or preliminary thinking, previous Which of the following is not true regarding audit documentation for a specific audit? a. 14 Basedon a. B) copies of articles of incorporation, bylaws and contracts. (1) documentation? A While audit documentation is held on the client’s premises it is the responsibility of the client to ensure its safe custody B The auditor need only ensure the safe custody of audit documentation for the duration of the audit C The auditor must ensure the safe custody of audit documentation for at least six years Quiz yourself with questions and answers for Audit Ch 4 quiz, so you can be ready for test day. The prospective client's system is highly automated and the auditor lacks understanding of such a system B The prospective client's CEO is also the chairman of the governing board C. This Auditing Standard is to be read in conjunction with ASA 101 Preamble to Australian Auditing Study with Quizlet and memorize flashcards containing terms like The audit working papers belong to: a. This was a significant step in resolving a long-standing issue regarding the auditing of Chinese companies listed on US stock exchanges. the auditor lacks the qualifications to evaluate the evidence. 7 - 7. Adding electronic documents produced outside of the audit working paper software that include evidence obtained before the auditor’s report date/assurance report. A. ” - 5 - PSA 230 The documentation requirement does not apply to basic principles and essential procedures that are not Chapter 16 Multiple-Choice Questions 1. Audit evidence obtained directly by the auditor will not be reliable if: a. B) Preparation of the management letter. Solution. An audit conducted in accordance with such law or regulation does not comply with PSAs. When initiating communications with predecessor auditors, prospective auditors should expect a. Copies of bond and note indentures. Test of account balance. decisions made in Audit documentation is a form of documentation that shows procedures applied in an auditing process by the auditor. Therefore, auditors need to gather evidence on The auditor normally considers both underlying accounting records and corroborating information in the audit process. Regulatory compliance C. Completeness d. , In auditing long-term debt, an auditor would be most likely to: A. the client denies its veracity. Perhaps the most important reason why materiality is not defined in the ISA is because the principle of materiality is first and foremost a financial reporting, rather than an auditing, concept. Identified Q&As 53. While performing an audit of the financial statements of a company for the year ended December 31, year 1, the auditor notes that the company's sales increased substantially in De Let us look at a few audit documentation examples to understand the concept better. A small, nonpublic company. 09b-c or AS 1201. The auditor need not include in audit documentation superseded drafts of working papers and financial statements, notes that reflect incomplete or preliminary thinking, previous copies of documents corrected for typographical Effective Date of Standard: For audits of financial statements, which may include an audit of internal control over financial reporting, with respect to fiscal years ending on or after Nov. 22, 2017 "Professional Liability Spotlight: Professional Liability Risk Resolutions for 2017," JofA, Jan. Effective procedures include inspecting documents from independent sources like bank statements. These papers form audit files. g. 3 PSA 315 Study with Quizlet and memorize flashcards containing terms like Which of the following best describes the role of analytical procedures near the end of the audit engagement? a. Underlying accounting records do not include which of the following items? a. 3, Audit Documentation, effective for audits of financial statements, which may include an audit of internal control over financial reporting, with respect to fiscal years ending on or after November 15, 2004. 27 When initiating communications with predecessor auditors, prospective auditors should expect A. Business; Accounting; Accounting questions and answers; Permanent or Current Year Files. Students are expected to write their names on the assignment, complete each . , 3. The auditor shall prepare audit documentation on a timely basis. results of analytical procedures from prior years. cross- referencing, To plan the nature timing and extent further audit procedures to be preformed , an auditor should establish a _______ level Real-world audit documentation examples In December 2022, for the first time, the Public Company Accounting Oversight Board gained complete access to audit documents from public accounting firms based in Hong Kong and China. FUTURE AUDIT WHAT AUDITORS DO: THE SCOPE OF AUDIT 5 Audit reports are far from the only communications tool in the auditors’ armoury. Total views 100+ Ramapo College Of New Jersey. A list of audit procedures that will be used to audit accounts Study with Quizlet and memorize flashcards containing terms like Auditors must make decisions regarding what evidence to gather and how much to accumulate. Your solution’s ready to go! Enhanced with AI, our expert help has broken down your problem into an Audit documentation should enable an experienced auditor without direct knowledge about the client to understand the procedures performed, the evidence obtained, and the conclusions reached by the auditor. Since this is a public guide which can be accessible to users, it is not included for Audit documentation does not normally include the: A) specific assertions under audit. Which statement below is not correct regarding the appropriateness of audit evidence? A) The more effective the internal control system, the more assurance it provides the auditor about the reliability of financial reporting by the client. • Correspondence (including e-mail) concerning significant matters. probability that some accounts are more susceptible to misstatement than others. Performance Audit, Special Examination, and Other Assurance Engagements. The form and content of audit documentation should be designed to meet the circumstances of the particular audit. information related to the understanding of internal control. Standard on Auditing (SA) 230, Audit Documentation, issued by ICAI lays down the basic principles that the auditors need to bear in mind while undertaking audit documentation. Audit files contain records that comprise the audit documentation for a specific engagement or client. , Which of the following presumptions does not relate to the appropriateness of audit evidence? a. C) provide evidence that prove or disprove an audit objective/assertion. (2) If a for-profit entity receives more than one award from DOE with a sum total of expenditures of $750,000 or more during the for-profit entity's fiscal year, but does not have any single award with expenditures of $750,000 or more; the entity must determine whether any or all of the awards have common compliance requirements (i. Audit procedures are used to gather corroborative evidence and verify account balances. Customer This does not imply that each specific working paper must include evidence of review, however there must be documentation of what work was reviewed, who reviewed the work and when it was reviewed. Verification that Examine supporting documentation of subsequent (after-period) cash disbursements and verify period of liability. b) copies of articles of incorporation, bylaws and contracts. External confirmations are normally used to gather evidence for all of the following accounts except: notes payable cash Accounts receivable BUILDING. D) decisions made in the course of Audit documentation refers to written records that include relevant evidence obtained and the conclusion that auditors reach. What Should Audit Documentation Include? The International Standards on Auditing (ISA) deal with audit working papers, which are also referred to as audit documentation. Realizable value c. Which of the following is a decision that must be made by auditors related to evidence? A) Sample size Timing of audit procedures Yes Yes B) Sample size Timing of audit procedures No No C) Sample size Timing Audit documentation integrity is vital, and firms must have an effective system of policies, procedures, and controls to ensure audit documentation is complete, archived on a timely basis and not improperly altered. Audit documentation refers to the records or documentation of procedures that auditors performed, the audit evidence that they obtained and the conclusion that makes by them Among other things, audit documentation includes records of the planning and performance of the work, the procedures performed, evidence obtained, and conclusions reached by the auditor. A common The permanent files included as part of audit documentation do not normally include: A) a copy of the current and prior years' audit programs. While AUDIT THEORY QUIZIZZ: Audit Documentation 1. Provide the principal support for the financial statement assertions. AI Chat with PDF. , 7. 96 as a form of audit documentation. Stage 2 audit - “Certification Audit” – an evidential audit to confirm that the organisation is operating the ISMS in accordance with the standard – i. ISA 230, “Audit Documentation,” sets out the requirements for audit documentation, which includes the working papers used by auditors. If additional evidence is required to document significant findings or issues, the original evidence is not considered sufficient and appropriate and therefore should be deleted from the working papers. A4. There are no Study with Quizlet and memorize flashcards containing terms like For an audit of a nonissuer, audit documentation does not A. An auditor may most likely decide not to accept a new audit engagement when A. Study with Quizlet and memorize flashcards containing terms like Which of the following normally occurs earliest in the audit examination? A) Discovery of an omitted audit procedure. Evaluating the public accounting firm's independence with regard An auditor should review the prior year audit documentation as well as the client's permanent file to understand the continuing client's business. , B. Total views 12. A schedule of individual audit team member billing rates, Which portion of an audit Effective Date of Standard: For audits of financial statements, which may include an audit of internal control over financial reporting, with respect to fiscal years ending on or after Nov. Specificassertions under audit . D. Find articles, books and online resources providing quick links to the standard, guidance and recent Study with Quizlet and memorize flashcards containing terms like The auditors' program for the examination of long-term debt should include steps that require the:, For audit purposes, a corporation's articles of incorporation are normally:, Which of the following is an auditor most likely to confirm from the transfer agent and registrar? and more. Letters of confirmation and representation. theaccountant'sunderstandingoftheindustry, b Study with Quizlet and memorize flashcards containing terms like Which of the following statements is true with respect to a time budget for an internal audit engagement?, Scope statements for assurance engagements may include which of the following? 1. Office. A basis for planning the audit 2. Study with Quizlet and memorize flashcards containing terms like 3. B) be based on sources that are external to company. Conducting the audit follow-up. record of the procedures performed. 2017 The post-audit activities include: Letter of reappointment of auditors; Notice of AGM, etc. Business rules. Write-offs must be authorized by company field sales employees who are in a position to determine customers' financial standing. 1/11/2017. 05c and AS 1215. Checklists. The company under audit. • Checklists. C) information related to the Whether the audit results will be shared does not determine the scope of the audit. Obtaining an understanding of the entity and its environment is an essential aspect of performing an audit in accordance with PSAs. (b) copies of articles of incorporation, bylaws and contracts. At the same time, cost of goods sold as a percentage of sales had decreased from 45 percent to 40 percent and year-end accounts receivable had increased by 8 percent. User manuals. To take responsibility for obtaining the client's consent for the predecessor to give information about prior audits b. Timing b. documentation. The basic What would the auditor not include in the audit documentation? A12. When I make these suggestions, some auditors push back saying, “We’ve already documented some of this information in the audit program. Definition: Audit documentation refers to the records or documentation of procedures that auditors performed, the audit evidence that they obtained and the conclusion that makes by them based on the evidence obtained. , 12. Also, the documentation should be appropriately organized to provide a clear link to the significant findings or issues. Organization charts. Written or oral communication with the client D. Boundaries of the process 2. B) planning and completion phases. 95% This chapter focuses on audit documentation. Accounting records. The largest portion of audit documentation will include detailed supporting schedules prepared by the client or the auditor in support of specific accounts on the financial statements. Annual Audit. A56-A59) Confidentiality, Safe Custody, Integrity, Accessibility and and specific contracts and agreements) as part of audit documentation. Study with Quizlet and memorize flashcards containing terms like The auditors' program for the examination of long-term debt should include steps that require the:, For audit purposes, a corporation's articles of incorporation are normally:, Which of the following is an auditor most likely to confirm from the transfer agent and registrar? and more. In accordance with paragraph . For other engagements conducted pursuant to the standards of the PCAOB, including reviews of interim financial information, this standard takes effect beginning with the first The statement, 'The permanent files included as part of audit documentation do not normally include' pertains to the essential components typically present in an auditor's files. AICPA resources. B) industry accounting guides. Therefore, auditors need to gather evidence on that may arise. Documentation must be in Office. Audit documentation does not normally include the . Oral communication B. copies of articles of incorporation, bylaws and contracts. 1 HKICPA “Hong Kong Standard on Auditing 230 Audit Documentation”, January 2024 Audit Documentation Integrity [This section was effective for audits of financial statements for periods beginning on or after May 15, 2002. Audit documentation can be classified in two categories: (1) permanent files (which contain information that is relevant for many years' 2. An auditor noted that client sales had increased 10 percent for the year. Work papers should be complete, accurate, and support observations, Study with Quizlet and memorize flashcards containing terms like Which of the following paragraphs or sections of the group auditors' report is modified to identify the extent of component auditor involvement in the audit of group financial statements? Multiple Choice The Management's Responsibility section. ACCT 421. Creating a link to documents or deleting them if they are not part of the final audit documentation. False, . The identity and the role of the EP communicated orally to the Management and TCWG, but however no documentation was kept. It is therefore not surprising that timely preparation of audit documentation (working papers) is a mandatory requirement of ISA 230. This PSA does not deal with instances when individual internal auditors provide 13. Providing Access to or Copies of Audit Documentation to a Regulator1,2. The requirements of ISA 230 include: Documentation of the planning Question: The permanent files included as part of audit documentation do not normally include A) a copy of the current and prior years' audit programs. 30 Audit documentation that shows the detailed evidence and procedures regarding the balance in the accumulated depreciation account for the year under audit will be found in the a. industry accoun | SolutionInn AUDIT THEORY QUIZIZZ: Audit Documentation 1. The auditor normally considers both underlying accounting records and corroborating information in the audit process. Audit documentation . Which one of the following is not one of the primary purposes of audit documentation? a. A basis for review by supervisors and partners b. A12. Documentation of logical step between findings and conclusion. Permanent files traditionally contain vital, A3. No, such records are to be kept and maintained by the management / owner of the entity. 137 Timely Preparation of Audit Documentation 7. The cash is collected. Examples of audit documentation include: Audit programs. A large, publicly traded company. 96, Audit Documentation, marks the first big change in the requirements auditors must observe when documenting their audit work. sales and cash receipts. To conduct interviews with the partner and manager in charge of the predecessor public This PSA does not deal with instances when individual internal auditors provide 13. A4 The auditor need not include in audit documentation superseded drafts of working papers and financial statements, notes that reflect incomplete or preliminary thinking, previous copies of The other types of assurance services usually provided by an auditor which are not related to Audit include due diligence report. Audit Documentation 2041 AU Section 9339 Audit Documentation: Auditing Interpretations of Section 339 1. The Auditor's The document provides information about audit procedures and evidence: 1. that the documented policies, Study with Quizlet and memorize flashcards containing terms like 1. Accounting for the proceeds of major stock issues. No companies use this system anymore. Study with Quizlet and memorize flashcards containing terms like Revenues are normally considered to have been earned when:, Sales are normally recorded on the date of the:, When auditing the revenue and collection cycle, auditors normally select Question: QUESTION 32 An audit objective that is normally not part of a financial audit of accounts payable account is: a. On a recurring engagement, auditors review the audit plans and audit documentation from the prior audit while planning the current audit to determine their usefulness for the current-year work. should not. The audit documentation should include documentation of the significant findings or issues discussed, Audit documentation is the documentation of the procedures carried out by auditors, the evidence they collect, and the conclusions they draw based on their work. Which of the following is a risk factor for misappropriation of assets? a) Generous performance-based compensation systems. Similarly, the results of investigations into exceptions or inconsistencies must be Signing off on an audit program is rarely sufficient to meet the requirements of the Audit Documentation standard. The independent auditor's direct personal knowledge, obtained through 5) When determining sufficient and appropriate audit evidence in order to form an opinion on the client's financial statements the auditor compiles audit documentation to support the opinion. Oral explanations can clarify Audit documentation does not normally include the: A) specific assertions under audit. Articles "How Well Do You Know Audit Documentation Requirements?" JofA, Aug. Correct record of the procedures performed. Belong to the 8 The permanent files included as part of audit documentation do not normally from ELECTRICAL 101 at Assuit University. Similarly, auditors will include evidence obtained and conclusions Audit documentation is defined as the record of audit procedures performed, relevant audit evidence obtained, and conclusions reached by the auditor in the engagement. 2 Audit procedures performed include audit planning, as addressed in PSA 300, “Planning an Audit of Financial Statements. Record of the procedures performed. The audit firm. Analysis of capital stock accounts. Demonstrate that the audit was performed in accordance with GAAS. ACCT. To conduct interviews with the partner and manager in charge of the predecessor public Study with Quizlet and memorize flashcards containing terms like (T/F) A canceled check written by the client, made payable to a local supplier and drawn on the client's bank account is one type of internal document. Confirmation of shares issued with the independent registrar. , 2) A benefit obtained from using industry averages is that it provides a(n) Adding electronic documents produced outside of the audit working paper software that include evidence obtained before the auditor’s report date/assurance report. 8) The permanent files included as part of audit documentation do not normally include: (a) a copy of the current and prior years' audit programs. Study with Quizlet and memorize flashcards containing terms like Giving each electronic and paper document a number, like a book page number so it can be found, removed and replaced without loss is called A. C) information related to the understanding of internal control. Expert Help. Decisions made in the course Audit documentation does not normally include the: industry accounting guides. Documentation is required Just as good communication is at the core of a quality and successful Teachers’ assignments typically include a set of tasks, similar to audit “work program steps,” to be completed. A flowchart of the internal control procedures. d. No matter how thoroughly they perform an audit procedure, they know if their documentation does not reflect what they've done, they can expect review comments from their supervisor. Statutory reporting, Which of the following is not a Business Management Support role of the Accounting/Finance Function Study with Quizlet and memorize flashcards containing terms like Which of the following would be considered in determining whether an internal audit department is independent? A)The organizational status of the audit committee and the individual independence of internal auditors in the department. The audit committee should also encourage a positive relationship between internal audit and the external auditor, to ensure a productive working relationship between them. A copy of the financial statements. ELECTRICAL. It provides general guidance on the nature and extent of documentation necessary to support the auditor’s report, and it reaffirms documentation’s role The preparation of audit documentation is an integral part of an auditor’s examination of financial statements. Documentation must be in The auditor’s documentation of any significant changes to the originally planned overall audit strategy and to the detailed audit plan need not include the reasons for the significant changes. UK auditing standards require auditors to communicate with ‘management and those charged with governance’ – including executive and non-executive directors – throughout the audit on a variety of matters. Auditors are not expected to examine all information that may exist. Study with Quizlet and memorize flashcards containing terms like 1) Analytical procedures are so important that they are required during the A) planning and test of control phases. Quiz yourself with questions and answers for Chapter 6: Quiz, so you can be ready for test day. industry accounting guides. to identify accounts that appear to be misstated with the intention of planning the nature, timing, and extent of other Study with Quizlet and memorize flashcards containing terms like Which of the following is not a Stewardship and Reporting role of the Accounting/Finance Function in Business? A. Management's attitude is that "once the books are closed, they're closed," and management does not want to make any adjustments. This checklist was developed from the AICPA’s PEER Review Government Audit Engagement Checklists for use by the Office of the State Auditor’s reviewers of audits of Minnesota Count ies. c. , The audit team is required to hold discussions referred to as _____ _____ about the Differentiating Internal Audit From Internal Control Activities. (Ref: Para. The auditor uses professional judgment to determine which For many staff auditors, the very mention of working paper review is enough to make their hair stand on end. The auditors are required to confirm bond holdings directly with the bondholders. 5. The detailed instruction that explains the audit evidence to be obtained during the audit. Auditors should understand the nature of the operations of the client, as well as the governance structure, ownership, financing, structuring and the investments of the entity. ACCT 5400. In your audit of Aviary Industries for calendar year 2016, you found a number of matters that you believe represent possible adjustments to the company's books. The auditor interviewed the sales manager who stated that the increase in sales without a corresponding increase in Study with Quizlet and memorize flashcards containing terms like Although the quantity and content of audit documentation varies with each particular engagement, an auditor's permanent files most likely include:, Which of the following statements concerning audit evidence is correct?, Which of the following does an auditor usually confirm on one form? and more. All possibility of return has expired b. AI Homework Help. b. , Audit documentation of the evidence gathered by the auditor should meet which of the following criteria? A. Audit documentation should be designed for the specific engagement; however, audit documentation supporting certain accounting records may be standardized. Show that accounting records agree with the financial statements. 47 The firm shall establish policies and procedures for the retention of engagement documentation for a period sufficient to meet the needs of the firm or as required by law or regulation. The Auditor's Study with Quizlet and memorize flashcards containing terms like When initiating communications with predecessor auditors, prospective auditors should expect: A. Hill, CPA, has been retained to audit the financial statements of Study with Quizlet and memorize flashcards containing terms like An audit firm's audit documentation DOES NOT:, Audit documentation should be sufficient to allow _____ to understand the audit work performed, the evidence obtained, and the significant conclusions reached, Audit documentation should identify all of the following except: -the dates client Study with Quizlet and memorize flashcards containing terms like The pre-engagement activities of an audit engagement for a public accounting firm do not include A. A record of the evidence accumulated and the results of the tests d. indexing B. Administrative audit documentation in the current file. Although documentation alone does not guarantee audit quality, the process of preparing sufficient and appropriate documentation con-tributes to the quality of an audit. This is a vital lesson that is instilled in auditors from the beginning of their Answer of - Audit documentation does not normally include the: Multiple Choice record of the procedures performed. 08 of AU-C Section 230, the auditor should document: The nature, timing, Audit documentation should not include superseded drafts of working papers and financial statements, notes reflecting incomplete and preliminary thinking. Log in Join. Duplicates of Adding electronic documents produced outside of the audit working paper software that include evidence obtained before the auditor’s report date/assurance report. To conduct interviews with the partner and manager in charge of the predecessor A3. B) copies of articles of incorporation, bylaws and sues with management and others on a timely basis, including responses. The auditor’s documentation of any significant changes to the originally planned overall audit strategy and to the detailed audit plan need not include the reasons for the significant changes. Factors that can influence the level of audit documentation detail include: - nature of auditing procedures - extent of judgment involved - risk of misstatement. Study with Quizlet and memorize flashcards containing terms like Which of the following paragraphs or sections of the group auditors' report is modified to identify the extent of component auditor involvement in the audit of group financial statements? Multiple Choice The Management's Responsibility section. Sometimes audit documentation may serve as a source of reference for the client, but it should not be considered a part of, or a substitute for, the client's accounting records. . Pages 11. 15. These matters are described below. probability that material misstatements have occurred in transactions entering the Study with Quizlet and memorize flashcards containing terms like 11. Study with Quizlet and memorize flashcards containing terms like When initiating communications with predecessor auditors, prospective auditors should expect: A. Audit documentation may be recorded on paper or on electronic or other media. • Summaries of significant matters. Analyses. Audit documentation does not normally include the. • Analyses. decisions made in the course of the audit. Work papers should be complete, accurate, and support observations, The permanent files included as part of audit documentation do not normally include: A) a copy of the current and prior years' audit programs. Every company must keep accounting records - whether they are trading, or not. Audit documentation, however, is not a substitute for the entity’s accounting records. False, The amount of evidence gathered is not important to an auditor since the quality of the evidence is of primary importance. 15, 2004. all of the above, Which one For audit evidence to be compelling to the auditor it must be sufficient and appropriate. D) Review Study with Quizlet and memorize flashcards containing terms like 7. Audit evidence is principally gathered to determine if the Study with Quizlet and memorize flashcards containing terms like A registrar/transfer agent system relating to capital stock is most likely used by: A. There are two primary objectives that it seeks to achieve. a. Audit Documentation 143 AU-CSection230 Audit Documentation Source: SAS No. B)The organizational level of the chief audit officer and the objectivity of the Study with Quizlet and memorize flashcards containing terms like 11. Any documentation that meets the above requirements but is not timely does not contribute to the effectiveness of audit documentation. The Board accepted this recommendation, and paragraph 4 in the final standard includes audit programs as an example of documentation. Goods have been shipped. 1, 2017 "Audit Documentation: Tips for Getting It Right," JofA, June 2017 "ASB Issues New Going Concern Auditing Standard," JofA, Feb. Time frame mitigate possible misunderstanding, the auditor shall not accept the audit engagement, unless required by law or regulation to do so. Examples of audit documentation include: • Audit programs. 33, states that "the auditor has an ethical, and in some situations a legal, obligation to The permanent files included as part of audit documentation do not normally include: a copy of the current and prior years' audit programs. True b. To conduct interviews with the partner and manager in charge of the predecessor 4. Internal control documents that auditor prepare in Ms words, Ms excel or [] A11. CSQC 1. Study with Quizlet and memorize flashcards containing terms like The auditor must gather sufficient and appropriate evidence during the course of the audit. sales and sales discounts. Study with Quizlet and memorize flashcards containing terms like For an audit of a nonissuer, audit documentation does not A. Pages 22. 128; SAS No. Audit documentation does not normally include the A. Detection of accounts that are past due. 3 PSA 315 and other information. The government. A1) Documentation of the Audit Procedures Performed and Audit Evidence Obtained Form, Content and Extent of Audit Documentation 8. Baruch College, CUNY. A basis for determining work deficiencies by peer review teams c. User manuals. B)The organizational level of the chief audit officer and the objectivity of the Study with Quizlet and memorize flashcards containing terms like Which of the following topics is not normally included in an engagement letter? A. Sufficient evidence must A) be well documented and cross-referenced in the audit documents. In particular, that understanding establishes a frame of reference within which the auditor plans the audit and Study with Quizlet and memorize flashcards containing terms like Which one of these process should have supporting documents for conclusions reached? a. Industry accountingguides. Solutions available. • Letters of confirmation and representation. This article describes and discusses the requirements of ISA 450 Evaluation of Misstatements Identified during the Audit and provides some examples Footnotes (AS 1105 - Audit Evidence): 1 In determining whether the report of the investee’s auditor is satisfactory for this purpose, the auditor may consider performing procedures such as making inquiries as to the professional reputation, standing, and independence of the investee’s auditor (under the applicable standards), visiting the investee’s auditor and discussing the audit The post-audit activities include: Letter of reappointment of auditors; Notice of AGM, etc. Each audit firm has its own file numbering and referencing system. Study with Quizlet and memorize flashcards containing terms like In planning and performing an audit, auditors are concerned about risk factors for two distinct types of fraud: fraudulent financial reporting and misappropriation of assets. An engagement letter is used primarily to: ensure a clear contractual understanding of the services to be The permanent files included as part of audit documentation do not normally include: A) a copy of the current and prior years' audit programs. The reviewer often has a difficult time tieing the work back to the audit Study with Quizlet and memorize flashcards containing terms like Which of the following topics is not normally included in an engagement letter? A. Study with Quizlet and memorize flashcards containing terms like The auditors' understanding established with a client should be confirmed through a(an) A. A registrar/transfer agent system relating to capital stock is most likely used by: A. Correspondence (including e-mail) concerning significant matters. As to audit documentation in general, it seems that many students do not fully appreciate the extent to which audit documentation should be prepared, and its form and content. C) record of the procedures performed. Audit working papers include records prepared by auditors that document their work. Consider what audit documentation typically includes, such as specific assertions under audit, a record of the procedures performed, and decisions made in the course of the audit. Study with Quizlet and memorize flashcards containing terms like The permanent (continuing) file of audit documentation most likely would include copies of the:, T/F: Lead schedules would be included in the current audit documentation since they are applicable to the current year's audit only, T/F: Attorney's letters would not be included in the current audit documentation since The auditing standard ISA 230 sets out the documentation requirements for auditors on audit working papers and audit evidence. C) Dual dating the auditor's report on the entity's financial statements for subsequent events that exist at the date of the financial statements. Minutes of Audit documentation would identify who reviewed the audit work but not who performed the audit work. This includes various materials, from policy documents and system logs to user manuals and transaction records. The auditor shall prepare audit documentation that is sufficient to enable an Study with Quizlet and memorize flashcards containing terms like When the auditor scans the sales journal looking for large and unusual transactions, he or she is gathering what type of evidence?, Which of the following is the risk that an auditor will reach an incorrect conclusion because a sample is not representative of the population?, According to PCAOB audit Process documentation does not include which of the following?Multiple ChoiceExternal audit workpapers. Written communication C. Show transcribed image text. , In creating lead schedules for an audit engagement, a CPA often uses automated Page Page 5 5 Time recording by Auditor (EP and members of the ET) is mandatory in under Para 9 of SA 230 which requires the auditor to record the nature, timing and extent of audit procedures performed in the Audit documentation. 122; SAS No. Documentation of Teams findings c. Audit documentation may also be Study with Quizlet and memorize flashcards containing terms like Revenues are normally considered to have been earned when___, Sales are normally recorded on the date of the_____, When auditing the revenue and collection cycle, auditors normally select balances to confirm from the_____ and more. Resolving replication conflicts in the audit working paper software. 22) When initiating communications with predecessor auditors, prospective auditors should expect a. D) decisions made in the course of For a large publicly traded client, the auditors' examination of capital stock accounts will not normally include: a. and more. C. Permanent file audit documentation. Study with Quizlet and memorize flashcards containing terms like . Audit reports normally contain conclusions, but the need to act or respond is dependent on the audit objectives or purpose. 1 1 All evidence must have the same level of Pages 13. Which of the following is not a valid purpose of such a 40. Study Resources. The CPA has knowledge of the prospective client's disregard of its responsibilities concerning internal Similarly, auditors cannot depend on the financial systems of the client to provide evidence for their work. All Study with Quizlet and memorize flashcards containing terms like The current file of the auditor's audit documentation ordinarily should include A. The permanent files included as part of audit documentation do not normally include: a) a copy of the current and prior years' audit programs. Study with Quizlet and memorize flashcards containing terms like Which of the following internal control activities will most likely prevent the concealment of a cash shortage by improperly writing off a trade account receivable? a. Similarly, ISA 230 requires it to be a part of the final audit file for a specific client. 1 to A24 and Appendix 1. Belong to the Office. c) information related to the understanding of internal control. Audit documentation does not normally include the specific assertions under from ACCT 5400 at Baruch College, CUNY. Audit documentation may be in the form of paper, electronic files, or other media. Accounting records must include: entries showing all money received and expended by the company The completion stage of the audit is when the auditor reviews the work performed and considers the implications for the auditor’s report. 4. Audit documentation is the record of audit procedures per- Sufficient and appropriate documentation should include evidence that the audit working papers have been reviewed. To conduct interviews with the partner and manager in charge of the predecessor 8 Not-for-Profit Audit Committee Guidebook The oversight tasks most commonly assigned to an audit committee in this area include: Internal and external audit • Recommending and appointing an independent audit firm • Discussing the propriety of financial statement presentation and the adequacy of footnote disclosures Similarly, auditors cannot depend on the financial systems of the client to provide evidence for their work. Comprehensive, detailed, and diligent documentation is vital in creating a robust audit trail. Multiple Choice. Audit documentation is sometimes called audit working paper or working paper. 8 the permanent files included as part of audit. Client responsibilities regarding the audit. Business rules. In auditing long-term debt, an auditor would be most likely to: A. Tax returns D. Yes Yes Yes b. The auditors' responsibilities with respect to the audit. Usually, permanent audit files include information about a client’s legal and organizational structure. (Ref: Para. Audit documentation should be sufficient to enable members of the audit team with supervisory responsibilities to understand the nature, timing, extent, and results of However, entity’s accounting record cannot be substituted for the audit documentation. The correct response is A) a copy of the current and prior years' audit programs. probability that the client's internal control policies and procedures will fail to detect material misstatements. Audit programs were specifically mentioned in SAS No. Specific assertions under audit. Doc Preview. e. A schedule of individual audit team member billing rates, Which portion of an audit AICPA standards on documentation Purpose of audit documentation per AU-C section 230, Audit Documentation, is to provide: • evidence of the auditor's basis for a conclusion about the achievement of the overall objectives of the auditor, and • evidence that the audit was planned and performed in accordance with GAAS and applicable legal and The audit supervision and documentation standards of both the ASB and the PCAOB require that the preparer and reviewer be identified in the audit documentation along with the date the work was performed (AU-C 230. Evidential matter should be competent, relevant, and reliable. Only the industry accounting guides is not included in the audit documentation. Convert all data from external formats to an internal company format. , are considered a cluster of awards) and Sufficient and appropriate documentation should include evidence that the audit working papers have been reviewed. Example #1 In December 2022, the PCAOB or Public Company Accounting Oversight Board announced that KPMG Colombia, KPMG UK, KPMG India, and four individuals linked with KPMG International Limited infringed its quality control standards concerning internal training programs and audit 9A. E. They are public record documents. b b. Audit documentation is defined as the record of audit procedures performed, relevant audit evidence obtained, and conclusions reached by the auditor in the engagement. Internal controls are the checks and balances put in place by a company to mitigate risk, and usually consist of an ongoing system of policies and An initial ISO 27001 certification audit involves: Stage 1 audit - “Documentation Review” to establish that the organisation has the required documentation for an operational ISMS. B. External audit workpapers. Human Resource management B. Several commenters suggested that audit documentation should include audit programs. The scope not only defines what will be audited, and from what time period, but also defines what will not be a part of the audit. 17. 01 Question—Section 339, Audit Documentation, paragraph . ` D. The most reliable evidence comes from external sources The permanent files included as part of audit documentation do not normally include: A) a copy of the current and prior years' audit programs. 1 Examples of audit documentation include memoranda, confirmations, correspondence, schedules, audit programs, and letters of representation. 34 Sales are normally recorded on the date of the a. This is equally important so that the outcomes do Study with Quizlet and memorize flashcards containing terms like Which of the following would be considered in determining whether an internal audit department is independent? A)The organizational status of the audit committee and the individual independence of internal auditors in the department. The formal documentation creating bond indebtedness is called the indenture. The company has substantially accomplished what it must to be entitled to the benefits. As a reviewer of documentation, if you have to ask the audit staff basic questions about the audit, the documentation probably does not really serve the purpose. Write an essay that set specific internal controls that should be included to meet the following management asserti; Which of the following statements is not one of the roles of the audit committee? a. Quality Control: Audit documentation ensures that audit procedures are consistently applied, and that the work is conducted in compliance with auditing standards and guidelines. it is impossible for the auditor to obtain additional corroboratory evidence. 1. specific assertions under audit. Review of Financial Statements 2569 Designing and Performing Review Procedures. Current file audit documentation. C) test of control and completion phases. Which of the following procedures would an entity most likely include in its disaster recovery plan? A. 134; SAS No. Audit documentation A should identify the items tested when the audit procedures from ACCT 421 at Ramapo College Of New Jersey Log in Join. It proves the reliability of an auditor's opinion in an audit report as it Clearly, having set out tests to meet specified audit objectives, test results should be clearly documented. 3. Clause 6 starts out with a statement that the conclusions of the audit can, depending on the audit objectives, indicate the need for actions. This section establishes related documentation requirements. Record of theprocedures performed . Registered bondholders receive periodic interest payments without any action on their part. Further, the auditor also need not include in audit documentation: Assemble the audit documentation in an audit file on timely basis (Ordinarily note more than 60 days from date of audit report) Administrative process and does not involve the performance of new audit procedures or the drawing of new conclusion Changes of administrative nature, to the audit documentation, may be made. All companies must use this type of system. Completely detailed audit plan, Which of the following is not one of the assertions made by management about an account In all cases, audit documentation should include information related to the (1) conditions or events that suggested going-concern uncertainties, (2) management’s plans to mitigate going-concern uncertainties and the audit procedures performed to evaluate management’s plans, and (3) the auditors’ conclusion as to whether substantial doubt exists about the client’s ability to continue CAS 230. Auditor may take abstract of some accounts, records, contracts etc as he may find relevant as per his judgement. ” That may be true, but I am telling you–after reviewing thousands of audit files–the message (what is being done and why) can get lost in the audit program. While it is a part of the audit evidence process, it does not form sufficient appropriate audit evidence. Accordingly, the auditor shall not include any reference within the auditor’s report to the audit having been conducted Study with Quizlet and memorize flashcards containing terms like 3. Decisions made inthe course of the audit . Areas that are within the scope and those that are excluded 3. It’s almost impossible to talk about internal audit without mentioning internal controls as both are needed to drive an effective risk management strategy. Summaries of significant matters. If a company does not have an internal audit function, it is a responsibility of the audit External confirmations are normally used to gather evidence for all of the following accounts except: notes payable cash Accounts receivable BUILDING. D) results of analytical procedures from prior years. Audit documentation is an essential element of audit quality. 123; SAS No. December 2018 Governmental Audit Documentation Checklist I-1 Governmental Audit Documentation Checklist . 13. Review and Supervision: This documentation enables parties to provide feedback, guidance, and oversight to ensure that the audit engagement meets professional standards. Write-offs must be Study with Quizlet and memorize flashcards containing terms like Inherent risk is the: A. Identified Q&As 31. To take responsibility for obtaining the client's consent for the predecessor to give information about prior audits. • Documentation . The form and extent of documentation depend on such matters as the size and complexity of the entity, materiality, the extent of other documentation, and the circumstances of the specific Study with Quizlet and memorize flashcards containing terms like 27. Documentation of risk assessment procedures and responses to risks of misstatement should include (1) a summary of the identified risks of misstatement and the auditor's assessment of risks of material misstatement at the financial statement and assertion levels and (2) the auditor's responses to the risks of material misstatement, including linkage of the responses to those risks. Audit evidence used to support an audit opinion is obtained solely from audit procedures. It was superseded by PCAOB Auditing Standard No. Which of the following is not a balance-related audit objective evaluated in the audit of accounts receivable? a a. Issues memoranda. Accuracy. EXECUTIVE SUMMARY STATEMENT ON AUDITING STANDARDS (SAS) no. rickyrosea. To conduct interviews with the partner and manager in charge of the predecessor Question: When planning an audit, which of the following is not a factor that affects auditors' decisions about the quantity, type, and content of audit documentation? Multiple Choice O The auditor judgments about materialny The suditors' need to document compliance with generally accepted auditing standards O The auditors' need to verty the existence of new tales Auditing Standard ASA 230 Audit Documentation ASA 230 – compiled - 6 - AUDITING STANDARD AUTHORITY STATEMENT Auditing Standard ASA 230 Audit Documentation (as amended to 5 December 2018) is set out in paragraphs Aus 0. For other engagements conducted pursuant to the standards of the PCAOB, including reviews of interim financial information, this standard takes effect beginning with the first Click here👆to get an answer to your question ️ audit of transaction does not include Study with Quizlet and memorize flashcards containing terms like The pre-engagement activities of an audit engagement for a public accounting firm do not include, In the planning stage, analytical procedures are used to, Public records from which of these sources could be used to find the owner of an office building? and more. 46 The firm shall establish policies and procedures designed to maintain the confidentiality, safe custody, integrity, accessibility and retrievability of engagement documentation. In particular, that understanding establishes a frame of reference within which the auditor plans the audit and and specific contracts and agreements) as part of audit documentation. Audit procedures must be carefully worded to make sure the instructions are clear since these are the instructions to be followed in accumulating evidence. D) planning, test of control, and completion phases. Study with Quizlet and memorize flashcards containing terms like C. The auditor need not include in audit documentation superseded drafts of working papers and financial statements, notes that reflect incomplete or preliminary thinking, previous Study with Quizlet and memorize flashcards containing terms like A registrar/transfer agent system relating to capital stock is most likely used by: A. auditors maintain adequate and appropriate audit documentation as an evidence of the work that they perform. 33 Revenues are normally considered to have been earned when a. A crucial part of this review is the evaluation of misstatements found during the audit. There are 2 steps to solve this one. C) information related to the understanding of internal control. include: Superseded drafts of working papers and financial statements; Notes that reflect incomplete or preliminary thinking; Previous copies of documents corrected for typographical or other errors; and. Question: Process documentation does not include which of the following? Multiple Choice Process models. 2 Audit evidence, which is cumulative in nature, includes audit evidence obtained from audit procedures performed during the course of the audit and may include audit evidence obtained from other sources, such as pre- and specific contracts and agreements) as part of audit documentation. 06b); however, the standards do not require a second sign-off by a reviewer on every workpaper. Instructions for Use of Checklist . Yes No Yes c. Study with Quizlet and memorize flashcards containing terms like Which of the following is not a financial statement assertion made by management?, Which of the following business characteristics is not indicative of high inherent risk?, As part of their audit, auditors obtain a representation letter from their client. it is provided by the client's attorney. Documents showing compliance with GAAS (in planning and conducting the audit) b. easy. A4 The auditor need not include in audit documentation superseded drafts of working papers and financial statements, notes that reflect incomplete or preliminary thinking, previous copies of documents corrected for typographical or other errors, and duplicates of documents. All financial statement audits will include an audit of the inventory cycle. The two primary classes of transactions in the sales and collection cycle are: easy a. Assuit University. The form and extent of documentation depend on such matters as the size and complexity of the entity, materiality, the extent of other documentation, and the circumstances of the specific This does not imply that each specific working paper must include evidence of review, however there must be documentation of what work was reviewed, who reviewed the work and when it was reviewed. However, ISA 320 Materiality in planning and performing an audit does not include a definition for materiality. The introductory paragraph. B) An auditor's opinion, to be economically useful Study with Quizlet and memorize flashcards containing terms like 1. The opinion paragraph. one should plan for the audit by setting the audit objectives. to identify possible deficiencies in the client's internal control over financial reporting b. , 2. Reconciliation of a stock certificate book with the general ledger. heading C. b) Effective workpapers ensure audit quality . A request that the client sign a copy of the letter. B) copies of articles of incorporation, bylaws and contracts. • Issues memoranda. bzgbpww cfho xlkzg sgaj rczndh celw jhakh cqsmw uwdjp brw