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CMA Final · Cost and Management Audit · Cost Audit Documentation, Audit Process and Execution

Under SCA 102 on Cost Audit Documentation, which statement best describes the effect of preparing audit documentation after the audit work has already been performed?

Documentation prepared after the audit work has been performed is likely to be less accurate than documentation prepared during execution. SCA 102 therefore encourages timely preparation, because it enhances the quality of the audit.

  1. AIt is likely to be less accurate than documentation prepared during execution of the workCorrect
  2. BIt is more accurate because the cost auditor has the full picture by then
  3. CIt is acceptable only for smaller entities and carries no quality risk
  4. DIt has the same reliability as documentation prepared at the time of the work

Explanation

The application guidance says that preparing documentation on a timely basis enhances audit quality. Documentation prepared after the work is done is likely to be less accurate than that prepared during execution. The option claiming greater accuracy reverses this position.

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