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CA Intermediate · Auditing and Ethics · Audit Documentation

CA Rohit is auditing Sundaram Foods Pvt Ltd. A new staff member asks what the objective of audit documentation under SA 230 includes. Which statement correctly reflects SA 230?

Audit documentation provides evidence of the basis for the auditor's conclusions and shows that the audit was planned and performed in accordance with the Standards on Auditing and applicable legal and regulatory requirements. It is not confined to misstatements and is not client property.

  1. ADocumentation is prepared only to satisfy regulators and need not support the audit report
  2. BDocumentation provides evidence of the basis for the auditor's conclusion on achieving the overall objectives and that the audit was planned and performed per SAs and legal requirementsCorrect
  3. CDocumentation is the client's property and the auditor must hand it over on request
  4. DDocumentation is required only for areas where misstatements are found

Explanation

SA 230 says documentation provides evidence of the basis for the auditor's conclusion about achieving overall objectives, and evidence that the audit was planned and performed in accordance with SAs and applicable legal requirements. Audit working papers belong to the auditor, not the client, and documentation is needed for all significant matters, not only misstatements.

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