Auditing and Ethics · Audit Documentation

Audit Notebook, Permanent and Current Audit Files Explained

Updated 4 October 2026 · Fact-checked

The permanent audit file holds information of continuing relevance across years, such as the MOA, AOA and legal documents. The current audit file holds working papers for one period's audit. The audit notebook is the auditor's running record of points noted during the audit, to be cleared before the report is signed.

Understand Audit Notebook, Permanent and Current Audit Files

An audit generates a lot of paper: working papers, confirmations, schedules, notes. If you leave it unorganised, you cannot review it, reuse it or defend it later. So auditors group it into files.

Some information does not change much from year to year. Examples are the entity's constitution, its history, important agreements and the organisation chart. If you filed it in each year's file, you would copy it every time. So you keep it once in the permanent audit file and update it only when something changes. It helps in later audits and saves time.

Information that belongs to one audit period goes in the current audit file. It holds the audit plan and programme for that year, the financial statements, working papers on each area, the management representation letter, the draft and signed report and the review notes. It is the evidence that the audit of that year was done as per the Standards on Auditing.

The audit notebook is different. It is a notebook or record kept by the audit team, in which they jot down points arising during the audit: queries to raise with the client, items to check later, doubtful matters, information still awaited and points for discussion with seniors. Each point is cleared as it is resolved. Pending points are reviewed before completion, so nothing is missed. It helps the auditor sign off with confidence, and it also supports the partner's final review.

Remember the link to SA 230: the audit file must be assembled on a timely basis after the date of the auditor's report. The permanent and current split is a practical convention of good practice, not a rule that SA 230 prescribes in these words.

Key rules to remember

Permanent audit file: Permanent file = information of continuing relevance across several years; Updated only when facts change. Examples: MOA, AOA, history, organisation chart, key long-term contracts, accounting policies, internal control description.
Current audit file: Current file = working papers and records of one audit period; Examples: audit plan and programme, financial statements, working papers, confirmations, representation letter, review notes, copy of signed report.
Audit notebook: Notebook = running list of points to clear before completion; Records queries, pending items, doubts and discussion points. The auditor ticks off each point when cleared.
Core difference: Permanent = many years; Current = one year; Notebook = open points; Use this one-line split to frame any comparison answer.

How to solve Audit Notebook, Permanent and Current Audit Files questions

Questions on this topic are usually 'differentiate', 'state contents' or 'where would you file this item'. Use this method.

1Read the question and mark what is asked: meaning, contents, difference or classification of an item.
2Define the file or notebook in one line, stating its purpose.
3Apply the test: does the item stay relevant over several years or only for this period?
4List contents in bullets, giving 4-6 relevant examples for each file.
5For a difference question, compare on 4-5 points: nature, period covered, updating, contents, use.
6Add the use or benefit, such as saving time, continuity and support for review.
7For a case question, name the file for each item and give a one-line reason.

Quickest way: One-year or many-years test

When to use it: Use for MCQs that ask where a document belongs, and for written answers when time is short.

Ask: will this document still matter in next year's audit without change?
If yes, choose permanent file. If it relates only to this year's figures or procedures, choose current file.
If the item is a pending query or a reminder point, it belongs in the audit notebook.
In written answers, use a two-column format (Permanent vs Current) with 4-5 rows so each row earns a mark.
Close with one line on purpose: continuity and saving time for permanent, evidence of the year's work for current.

Common mistakes in Audit Notebook, Permanent and Current Audit Files

Putting the audit programme for the year in the permanent file.
Students assume a programme is a standard document.
Fix: The programme is updated and used for one period, so it goes in the current file.
Treating the audit notebook as the same as the current file.
Both are kept during the audit and both contain notes.
Fix: The notebook is a list of open points to be cleared. The current file is the full set of working papers for the year.
Saying the permanent file never changes.
The word 'permanent' sounds fixed.
Fix: Say it is reviewed and updated whenever facts change, such as an amendment to the AOA or a new loan agreement.
Listing financial statements of the year as permanent file contents.
Students mix up the entity's lasting documents with annual outputs.
Fix: The current year's financial statements and trial balance go in the current file.
Writing a difference answer in paragraphs with no clear points.
Students know the ideas but not the format.
Fix: Use a point-wise comparison with the basis, permanent file and current file for each row.

Worked examples

Example 1

Differentiate between the permanent audit file and the current audit file. Give two examples of contents of each.

Show the solution

Purpose: The permanent file keeps information of continuing relevance across years. The current file keeps the records of the audit of one period.
Period covered: Permanent file covers several years. Current file covers a single period.
Updating: Permanent file is updated only when facts change. Current file is created afresh each year.
Use: Permanent file gives background and saves time in later audits. Current file is evidence of work done and supports the report for that period.
Examples: Permanent file has the MOA and AOA, and the organisation chart. Current file has the audit programme for the year and the management representation letter.

Answer: The permanent file holds multi-year information such as the MOA, AOA and organisation chart, and is updated only on change. The current file holds one period's working papers such as the audit programme and representation letter, and is prepared afresh each year.

Example 2

An audit team is auditing a company for the second time. Classify each item as permanent file, current file or audit notebook: (a) copy of the lease agreement for the factory running for 10 years, (b) bank confirmation as at the year end, (c) query on an unexplained credit in the ledger, awaiting client reply.

Show the solution

Item (a): the lease is a long-term agreement relevant to many years. It goes in the permanent file. Update it if the lease is modified.
Item (b): the bank confirmation relates to balances at this year end only. It is audit evidence for this period, so it goes in the current file.
Item (c): this is an open point awaiting a reply. Record it in the audit notebook, and clear it before completion.
Once the reply arrives and is checked, the working paper that records the resolution goes in the current file.

Answer: (a) Permanent file. (b) Current file. (c) Audit notebook until cleared, and then the resolution is documented in the current file.

Exam tips

Differentiate questions are best answered point-wise, with four or five bases of difference.
Learn one list of typical contents for each file and be ready to give them in bullets.
Do not claim that SA 230 prescribes the permanent and current file split. Present it as accepted practice.
For MCQs, apply the many-years versus one-year test and watch for pending queries as notebook items.
Link the answer to purpose: continuity, time saving, evidence and review.

Practice questions from Audit Documentation

Audit Notebook, Permanent and Current Audit Files: frequently asked questions

What is the audit notebook?

It is a record kept by the audit team of points that arise during the audit, such as queries, pending items and doubts. Each point is cleared as it is resolved. It is reviewed before the audit is completed.

What goes into the permanent audit file?

Information of continuing relevance, such as the MOA and AOA, history and nature of business, organisation chart, key long-term agreements, a description of the accounting system and internal control, and accounting policies. It is updated when facts change.

What is the main difference between permanent and current audit files?

The permanent file covers matters relevant over several years and is updated only on change. The current file covers a single audit period and contains the working papers and evidence for that year's audit.

Is the permanent file kept forever?

No. The name refers to its continuing use across audits, not to endless retention. Retention follows the firm's policy and legal requirements, and the file is updated or replaced as facts change.