Audit Documentation

According to audit standards, audit documentation is records kept by auditors from procedures, exams conducted, information obtained, and conclusions achieved in the agreement. The audit documentation must include all information deemed necessary by the auditor to conduct an adequate audit and to provide support for audit reports.

Audit documentation is the primary way to document where an adequate audit has been conducted in accordance with GAAS. Audit documentation provides an important source of information to assist auditors in determine the right audit report to be made in a specific set of circumstances.

Purpose of Audit Documentation

In general, the purpose of audit documentation is to help auditors provide reasonable assurance that adequate audits have been conducted in accordance with generally accepted audit standards (GAAS). More specifically, the audit documentation, in contact with the current year's audit, provides a basis for planning an audit, a record of the accumulated evidence and the results of the exam, data to determine the right type of audit report, and a basis for review bysupervisors and partners.

The data in the archive is useful to evaluate the adequate scope of audits and fairness in financial statements, while also containing information needed to assist clients in the preparation of financial statements.

The audit archive is the main reference frame used by the supervising person to evaluate whether competent evidence has been accumulated to support the audit report. Audit records also serve as the basis for preparing taxes claims with the SEC (or Bapepam), and other reports. The audit archive is also a source of information received by the audit committee and management on various matters such as internal control weaknesses or operational recommendations. 

Audit archives are used to train employees and as an aid in planning and coordinating audits

Audit documentation prepared during the working time, including the schedule prepared by the client, is the ownership of the auditor. The need to maintain a confidential relationship with a client is demonstrated in rule 301 of the Code of Professional Conduct, which states:

"A member may not disclose any confidential information obtained in a series of professional agreements except with the client's consent."

Each public accounting firm makes its own approach to setting up and managing audit records, and novice auditors should take that corporate approach.

Permanent Archives, intended to contain data of historical or continuing nature that is with the current audit. This archive is a source of information that facilitates audits that continue to be in demand from year to year. The Permanent Archives include:

• Extracts or copies of company documents are continuously important as articles of incorporation, bylaws, bond agreements, and contracts.  Contracts are pension plans, rentals, stock options, and more. Each of these documents is important to auditors because it has been influential for many years.
• Analys, from the previous year, of accounts that are always important to auditors.  These include accounts such as long-term securities, shareholder equity accounts, goodwill, and fixed assets.
• Examine information relating to the understanding of internal controls and control risk assessment. This includes organization charts, account charts, questionnaires, and other internal control information, including enumeration of controls and weaknesses in the system.
• Procedural results of the previous year's audit. Among these data are the ratio and percentage calculated by the auditor and the total balance or monthly balance for a given year. This information helps auditors decide whether there are unusual changes in current year account balances that should be investigated more extensively.

Main schedules.

The main skedul is a working paper used to summarize the information recorded in the supporting skedul for the associated accounts. The main checkbook is used to combine similar general ledger accounts, the amount of which will be included in the financial statements in one amount.

Supporting schedules.

In each supporting schedule must be listed the work that has been done by the auditor in verifying and analyzing the elements listed in the client's financial statements, verification methods used, questions arising in the audit, as well as answers to question. It also contains various conclusions made by auditors.