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ISA (UK and Ireland) 230 Audit documentation


What auditors should document in an audit file?

ISA (UK and Ireland) 230 (revised) Audit documentation was issued in January 2006 and takes effect from 15 June 2006. The standard outlined the auditor’s responsibility in documenting audit procedures including clarification of the form, content and the extent of audit documentation with consideration to confidentiality, safe custody and the retention of audit documentation.

Auditors are required to assemble the final audit file on timely basis after the date of the auditor’s report was issued.

The standards also set out specific requirement on deletion of superseded documentation.

In exceptional circumstance where specific audit tests are not carried out that is relevant to the circumstances of the audit, the reason of departure should be documented and the auditor should document how the alternative procedure performed achieve the objective of the audit.

What businesses can benefit from maintaining a good accounting record?

It is essential to keep accounting books and records in a manner that can be easily retrievable. A good records filing system with unique referencing in place would be recommended.

A good filing system will eliminate the hassle of taking hours to retrieve an invoice that paid 6 months ago or reduced the chance of misplacing the papers. Being organized is the key point.

Having a good accounting records system will also help auditors to expedite the audit process especially when they are carrying out walk through tests to confirm their understanding of sales, purchases, debtors, creditors, receipts, payments systems and related controls. This will lead to saving in audit fee for you as auditors normally charge their fee on hours spent on the audit. Less hours means less to pay, it is good for you.

Where sage software is used for accounting records, preferably a reference is to be given to each transaction posted to Sage, so that the invoice (paper evidence) can be traced to filing system using the reference obtained from Sage records quickly.

Any filing system that enables quick retrieval of documents is a good system.

Please feel free to email us should you have any questions on filing system

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25% writing allowance
40% first year allowance and 25% writing down allowance
50% first year allowance and 25% writing down allowance