02-PS_Preparing Audit Documentation AS2 V12

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The Audit Experience AS/2

Performance SupportPreparing Audit

Documentation

The information in this performance support is provided to help you prepare audit documentationfor all of your audit work throughout the engagementfrom planning and controls to substantive

procedures This document discusses the importance of why all work needs to be documented!

details what to document in your working papers! defines review notes! provides guidance and

procedures for clearing review notes! and tips on how to safeguard your audit documentation

This performance support will cover the following topics "click on a link to go to the topic#$

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o (etails of %ork erformed 3llustration

o .eferencing and Symbol 3llustration

o Tickmark %orksheet 3llustration

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o .eview -ote 3llustrationTemplate

o .eview -ote 3llustrationExcel

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WHY DO YOU DOCUMENT YOUR WOR!

(ocumentation is a key part of our audit8 it provides support for the audit opinion given on the

financial statements and is evidence of the work we have done )ur documentation should be

detailed enough to enable an experienced auditor! having no previous connection with the audit!

to understand the nature! timing! and extent of the audit procedures performed! the results of the

audit procedures performed! the audit evidence obtained! any significant matters arising during

the audit! and conclusions reached

3f you do not document your work properly! then the audit field senior or audit manager may

think that you have not understood your assignment or have not completed the audit proceduresroper documentation will also help to reduce the amount of review notes "review notes are

described later in this performance support# you receive! as your work will be easier to follow!

and you will not have to spend time amending poor documentation (ocumentation prepared at

the time the work is performed is likely to be more accurate than documentation prepared

subse9uently! therefore audit documentation should be prepared on a timely basis

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The regulatory environment has become more rigorous over time! with the auditing standards we

need to comply with becoming stricter roper and timely documentation of the work performed

is the best way to demonstrate compliance with these regulations and standards

A common view to documentation is :if it;s not documented! it;s not done This way! whether looking at

the bank reconciliation or at the cash leadsheet! the reviewer will be able to find the other

piece of information

As mentioned above! you must also fill in the relevant SAS documents "eg! ,A# for

the tests performed and reference to the audit documentation where you have documented

the audit work performed to address the risks

+lick on the link "by holding down the +trl key# to be taken to .eferencing and Symbol

3llustration.

5ink the audit documentation where you have performed testing of risks to further

information needed to support the work performed

3f there is too much information to put on the face of a working paper then it should be

put in a tickmark Tickmarks are used to provide additional context and/or support for

information contained in a %orking aper or within an engagement item A tickmark is a

reference to a separate worksheet within the audit documentation where more details aregiven This is to prevent the leadsheet and document! where testing is performed! from

becoming too crowded with information! allowing the reviewer to see all of the pertinent

information on the main working paper! such as what work was done and the results of

the testing to address the risks of material misstatement The reviewer can then go to the

tickmark worksheet to see further details8 usually found as the last worksheet within the

audit documentation

A tickmark reference should be put next to the information that needs further explanation

This clearly identifies what work was performed relative to the specific information!

prevents reviewer confusion of what the tickmark is referring to! and allows for clean!

easyDtoDread audit documentation

Some member firms have guidelines for the type of information that should or should not

be included in a tickmark! such as! details of errors found Some member firms prefer to

have this documented in the working paper so they can easily identify errors found

+heck with your member firm on preferences in documentation

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o +lick on the link "by holding down the +trl key# to be taken to Tickmark %orksheet

3llustration

Each field senior may have different preferences for how work is documented and therefore it is

important to check with your field senior before starting any work

6or additional guidance on what needs to be documented! refer to the following$

erformance Support*sing the ,odel Audit rogram

erformance Support%orking with AS/2

AA, D =2=$ repare and +ontrol Audit (ocumentation and =>=$ .eview of Audit

(ocumentation

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Details of Work Performed Illustration



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Referencing and Symbol Illustration



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Tickmark Workseet Illustration

WHAT 4S A RE54EW NOTE AND HOW DO 4 DEA, W4TH 4T!

A review note is a tool used by reviewers to comment on your audit documentation These will

be raised by your field senior! audit manager! and/or engagement partner throughout the audit

and are comments you must address

.eview notes can cover all kind of points! from asking you to expand on an explanation you

documented to asking you to increase your sample siGe and do additional testing 'ou can also

raise review notes as reminders for yourself or for other team members if you have not

completed your audit section before your last day on the engagement

.eview notes may be raised in different ways$

C# *sing the .eview -ote Template working paper$


This information is too detailed to include on

the face of the working paper, therefore we

document the details in tickmarks shown

here.

Any result, misstatement, identied etc.

should be documented in the main working

Any unused tickmarks should be left blank and any information in old tickmarks should

be deleted and the tickmark left blank. For example, if there is existing information for the

prior period, that is no longer applicable or incorrect in the current period, you should

either delete the old information and leae the tickmark blank or update the information

for current period.

!er "etails of #ork

!erformed $llustration,

these are the tickmark s

referenced on the working

a er


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.eview -ote Templatethis is a %ord template within AS/2 .eviewers may use this

template for leaving 9ueries on SAS documents and manual audit documentation as a

review note cannot be created directly in these documents That does not mean the

reviewer will not use this template for %ord and Excel files as well

2# %ord and Excel electronic review notes using AS/2 Tools$

%ord and Excel review noteselectronic review notes created using AS/2 Tools within

%ord and Excel .eviewers may use this method to attach their comment directly to the

audit work about which they have a comment

B# ,anual hand written review note document "occasionally used#

+lick on the link "by holding down the +trl key# to be taken to .eview -ote 3llustration

Templateor.eview -ote 3llustrationExcel

See below for some general dos and do nots of review notes$

a %hen you receive your reviewed audit documentation! read all the review notes first

3f you have any 9uestions about any of them! make sure you talk to the reviewer

before attempting to answer them

b .eview notes need to be cleared in the audit documentation and not in the actual

review note This is because at the end of the audit! all review notes are removed

from the file Thus! if the audit work is included in the review note! it will be lost

c 6or example! the field senior may leave a review note asking you to document the

entity staff with whom you spoke! and when you spoke with them (uring

completion of your testing! you would document this in the audit documentation 3n

the review note! you would write that you had updated the audit documentation as

asked

d %hen you clear a review note! you should put your initials and a short comment on

the work you have done to address the comment in the review note This allows the

reviewer to see 9uickly what additional work you have done without reDreviewing all

of the audit documentation

e 'ou must clear all review notes on your work prior to the issuing of the audit report

These could be from your field senior! audit manager! or audit engagement partner

f 'ou should never delete a review note raised by someone else unless you have beenspecifically asked to do so .eviewers will delete a review note once they are

satisfied that it has been addressed appropriately

6or more information on .eview note template and Excel review notes! refer to erformance

Support%orking with AS/2

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Re!ie" #ote Illustration$ Template

Re!ie" #ote Illustration%&xcel

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WHAT DOES 4T MEAN TO SA7E(UARD MY AUD4T DOCUMENTAT4ON!

As audit documentation is the evidence of your audit testing to address the risks identified! you

need to ensure that it is not lost or compromised

'isted belo" are some basic safeguarding measures:

All of your audit documentation must be backed up at the end of each day to ensure that!

if anything should happen to your laptop! or if you are unexpectedly unable to come into

work the next day! your progress toDdate will not be lost

'our audit documentation may be backed up with the entire AS/2 file by your field

senior! or you can transfer your files to a *S1 stick &owever! make sure that you do not

keep your *S1 stick and laptop in the same place 3f one goes missing! then the backup

will be missing as wellH

3f using a *S1 stick to transfer/backup information! make sure that it is passwordprotected This way! if anything is on the *S1 stick when you transfer information! or if

the *S1 stick is lost! no one other than yourself can access this information

-ever leave your laptop unattended without locking it up first8 this includes both

physically locking down the e9uipment and electronically locking the screen 'ou must

follow the firm;s security policies at all times8 ask your field senior if you are unsure as to

what they are

(o not leave your working papers or entity documents visible when you leave the audit

room "eg! when going for lunch# Entity staff could come into the audit room and catch

sight of some confidential information! such as the entity;s payroll report

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-ote that this performance support does not replace the AA, 3t should be read in conIunction

with the applicable AA, topics! as the manual states the re9uirements of our audit approach and

it provides further guidance

" #$$$%#$ De'oitte ('o)a' Ser*ice+ ,imitedPartner+ in ,earning &.

Documents

02-PS_Preparing Audit Documentation AS2 V12