Documentation

Question 1

What is the purpose of working papers?

Answer 1

1. Support the conclusions drawn by the assurance provider
2. Provide an overall understanding of the work undertaken
3. Provide evidence of compliance with relevant laws, regulations, and professional standards

Question 2

What do working papers provide a record of?

Answer 2

1. The planning and performance of the engagement
2. The supervision and review of the work performed
3. The evidence contained which the assurance provider considers necessary, and on which they have relied to arrive at their conclusion
4. The quality control procedures carried out

Question 3

What media can working papers be held as?

Answer 3

Any media

Question 4

Why must audit documentation be sufficient?

Answer 4

Audit documentation must be sufficient to allow an experienced auditor with no previous connection with an audit to understand the audit work performed, evidence obtained, significant matters arising, and conclusions reached.

Question 5

What are the types of audit file?

Answer 5

Permanent and current

Question 6

Describe a permanent audit file

Answer 6

1. Matters of a permanent or semi-permanent nature
2. Suitably indexed
3. Prepared at the commencement of the initial audit for the client
4. Reviewed and updated at the commencement of subsequent audits for the same client

Question 7

Describe a current audit file

Answer 7

1. Relate primarily to the set of accounts or statements being recorded
2. Suitably indexed
3. Prepared for the client on each occasion an audit is performed

Question 8

How long should working papers be held for?

Answer 8

This is a matter of judgement, although the ICAEW requires all firms to have a document retention policy and registered auditors should keep all audit working papers required by auditing standards for at least six years from the end of the accounting period to which they relate.

Question 9

Describe working papers created by the assurance provider

Answer 9

1. Belong to the assurance provider
2. Must be kept confidential
3. May be shown to the client at their discretion
4. Should not be shown to a third party without the client’s permission

Question 10

Who do reports created as output to an assignment belong to?

Answer 10

The client once they have been issued