What can
be considered as an Audit Working Paper and what cannot has been widely
debated. ISA 230 on Audit Documentation has clarified this for the profession
and made life simple for judgments. Audit file reviewers usually use it as
a Bible while conducting cold file reviews.
As far as possible, audit working papers should be in a standard format and the
format should be retained throughout the audit file.
Contents of a good working paper:
1. Name of the client
2. Period
3. Name of the Creator of the working paper
4. Date on which it was prepared
5. Name of the client staff if provided by the client
6. Date of receipt if provided by the client
5. Name of the Reviewer
6. Date on which it was reviewed
7. Audit objective for the test done in the working paper
8. Samples selected & method of sampling (In absence of separate
documentation for sampling)
9. Key for any colours or jargons used on the working paper
10. Reference to the working paper for resolution for any audit findings
11. Conclusion of the Test.
Have
given below extracts from the ISA for better understanding of the reader on
what is expected from an audit working paper.
The auditor should prepare, on a timely basis, audit documentation that
provides:
1. A sufficient appropriate record of
the basis for the auditor’s report, and
2. Evidence that the audit was
performed in accordance with ISAs and applicable legal and regulatory
requirements
3. The nature, timing, and extent of
the audit procedures performed to comply with ISAs and applicable legal and
regulatory requirements
4. The results of the audit
procedures and the audit evidence obtained, and
5. Significant matters arising during
the audit and the conclusions reached.
The auditor should prepare the audit
documentation so as to enable an experienced auditor, having no previous
connection with the audit, to understand:
1. The nature, timing, and extent of
the audit procedures performed to comply with ISAs and applicable legal and
regulatory requirements
2. The results of the audit
procedures and the audit evidence obtained, and
3. Significant matters arising during
the audit and the conclusions reached.
In documenting the nature, timing,
and extent of audit procedures performed, the auditor should record:
1. Who performed the audit work and the date such work was completed,
and
2. Who reviewed the audit work and the date and extent of such review
(3).
In documenting the nature, timing, and extent of audit procedures performed, the auditor should record the identifying characteristics of the specific items or matters being tested.
