The Runners Shop
• AU 339 (SAS 103): Audit Documentation
• Auditing Standard No. 3: Audit Documentation
• International Standard on Auditing 230’ (Revised) (Site -http://irba.co.za/documents/doc_00535.pdf )
1] Describe the purposes of audit documentation and explain why each purpose is important.
According to AU 339.03, “audit documentation provides the principal support for the”: (a) “representation in the auditor’s report that the auditor performed the audit in accordance with GAAS”, and (b) “opinion expressed regarding the financial information or the assertion to the effect that an opinion cannot be expressed”. AU 339.04 goes on to state that this “audit documentation is an …show more content…
• Audit documentation is used by auditors to conduct inspections or peer reviews. Audit documentation would provide reviewers with a clear picture of how the audit was performed. This information is needed in determining if the audit was performed in compliance with GAAS and whether the conclusions reached were adequately supported.
• Audit documentation is used by the successor auditor when reviewing the predecessor auditor’s work. The successor auditor will review the previous year’s audit documentation to help gain a better understanding of the business, to identify any high risk areas that might affect acceptable level of risk, and to assist in planning the audit. Without this documentation it would be difficult for the successor auditor to achieve these goals.
According to AS 3, Paragraph A8 “good audit documentation improves the quality of the work performed in many ways, including, for example: a) Providing a record of actual work performed, which provides assurance that the auditor accomplishes the planned objectives. b) Facilitating the reviews performed by supervisors, managers, engagement partners, engagement quality reviewers, and PCAOB inspectors. c) Improving effectiveness and efficiency by