1. Main evidence of procedures, work performed on audit
2. Prepare sufficient & appropriate audit documentation on timely basis 3. enhance audit quality
4. facilitate effective review
5. evaluate audit evidence obtained & conclusions reached before finalizing auditor’s report 6. assisting audit team plan & perform for audit
7. assist audit team members’ supervise & direct audit work, discharge responsibilities (Quality Control for an Audit) 8. enable team account for its work
9. retain record (continuing significant matters) future audits 10. enable experienced auditor conduct engagement QC reviews & inspections 11. enable conducting external inspections with applicable legal, regulatory requirements Types of audit documentation
1. audit strategy, audit plan
2. audit programs
3. analysis, analytical procedures worksheets
4. internal control questionnaires, evaluation questionnaires 5. significant matters’ summaries
6. confirmation letters (for trade receivable confirmation) 7. representation letters
9. correspondence concerning significant matters
10. copies: entity’s records, e.g. contracts, agreements
1. using standard schedules, computer program
standard audit program
standard internal control questionnaire
standard audit file structure
* document continuous important materials, info relevant to audit entity’s financial statements
1. permanent file index, checklist
2. admin. Info
primary client’s contact, position, audit location, approximate audit time each year
3. special instruction, agreement with entity
reporting deadline, group audit instruction in common
engagement letter’s copy, amendments, updates
current files’ list maintained for entity
entity’s general background
group structure (subsidiaries’ name, associates, JV)
brief history, operation’s place
business, products, services’ description
list: directors, company secretaries, shareholders, services contacts
retirement plan (MPF, scheme under Occupation retirement Ordinance), employee benefit plan (share option scheme, medical scheme)
list: bankers, solicitors, IT consultants
registered office’ s address, incorporation place
list: major suppliers, customers, related parties
list: major properties, assets held by entity
statutory materials (M & A’s copy, articles of association)
share capital history, reserves
important agreements’ copies
bank facilities letters
patent, trademark agreement
list: laws & regulation (Securities Ordinance, Banking Ordinance) 11.
list: important accounting matters
notes: meeting, interview, correspondences
summary: internal audit functions, internal auditors’ reports 14.
system documentation: control environment, internal control narrative & evaluation 15.
letters to management (regarding internal control, systems in previous years) 16.
entity’s previous years’ audited, signed financial statements
info, matter relevant for current year
overall audit strategy, plan
audit program with tailored-made audit procedures
audited, signed, approved financial statements by BoD 5.
mgt representation letter
letter to mgt, their reply / resolution
representation on directors’ remuneration
entity’s Trial balance, mgt accounts, journal adjustments, budget 10.
each B/S items’ schedules with audit procedures performed, findings, conclusions 11.
each I/S items’ schedules with audit procedures performed, findings, conclusions 12.
Disclosure checklist comply with Companies Ordinance, HKFRSs,...
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