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Topic 6 audit documentation

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AUDITING AND ASSURANCE SERVICES IN MALAYSIA

TOPIC 6: AUDIT DOCUMENTATION

References: Chapter 7AUD390 2011AUDITING AND ASSURANCE SERVICES IN MALAYSIA

LEARNING OUTCOMESAUD390 2011TYPES OF WORKING PAPERS/FILESINDEXING, AUDIT CROSS-FOOTING AND EXTENSIONCONTROL AND RIGHTS TO THE AUDIT WORKING PAPERSCONFIDENTIALITY

AUDIT WORKING PAPERAUD390 AUDITING DIADef the principal record of auditing procedures applied, evidence obtained, & conclusions reached by the auditor in the engagementIt should include:The information the auditor consider necessary to conduct the auditThe information needed to prepare an audit reportObjective:The aid to auditor in providing reasonable assurance that an adequate audit was conducted in accordance with auditing standards

ContAUD390 AUDITING DIAFunction of Audit WPPlanning and performing the auditSupervising and reviewing the audit workGathering evidence and providing essential support for the auditors opinion, including evidence that the examination was conducted in accordance with the auditing standards.

TYPES OF AUDIT WORKING PAPERAUD390 AUDITING DIAPermanent FilesDef Data of a historical or continuing nature pertinent to the current auditIt include:Extract or copies of such company documents of continuing importance as the articles of incorporation, bylaws, bond indentures & contractsAnalysis from previous years of accounts that have continuing importance to the auditorInformation related to the understanding of internal control & assessment of control riskThe results of analytical procedures from previous years audits

ContAUD390 AUDITING DIACurrent FilesAll audit documentation applicable to the year under auditIt include:Audit ProgramsAuditing Standards require a written audit program for every auditGeneral InformationDocuments to support audit for current yearE.g. audit planning memos, abstracts or copies of minutes of the BOD meeting, abstract or contracts or agreements not include in the permanent file, etc.Working Trial BalanceA listing of the general ledger accounts & their year-end balancesSupporting SchedulesE.g. analysis, trial balance or list, reconciliation of amounts, test of reasonableness, summary of procedures, examination of supporting documents, informational & outside documentation

CONTROL & RIGHTS TO THE AUDIT WORKING PAPERSAUD390 AUDITING DIAThe ownership: the property of the auditorPart A-5 of the MIA By-Laws (Code of Professional Conduct & Ethics) highlighted that there is a need to maintain a confidential relationship with the clientException:Subpoenaed by a courtUsed as part of MIA approved peer review program with other CA firms

TUTORIAL QUESTIONSAUD390 AUDITING DIADifferentiate between permanent audit file and current audit file and give 1 example of the document contained in the respective files.Briefly describe 3 purposes of preparing audit working papers.