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Auditing - Importance of Documentation | 11th Auditing : Chapter 5 : Documentation

Chapter: 11th Auditing : Chapter 5 : Documentation

Importance of Documentation

Documentation is important in the course of audit work due to the following:

Importance of Documentation

 

Documentation is important in the course of audit work due to the following:

 

1. Fixation  of  Responsibility  and Accountability: Documentation helps in determining and fixation of responsibility among the audit staff. It further creates accountability for the work performed by the audit staff.



 

2. Permanent Record: Documentation is a permanent record, it acts as a manual for reference for planning the audit for future and also in similar types of new audit engagements.

 

3. Documentary Record: Documentation acts as documentary evidence when a charge of negligence is charged against the auditor.

 

4. Helps in Preparing Audit Report: Adequately documented plan and control of audit work evidences the practices, procedures followed in audit and important things. It further helps in preparation of audit report.

 

SA-230 on Audit Documentation issued by ICAI state the factors that determine Audit Documentation

The size and complexity of the entity.

Nature of audit procedures to be performed.

The identified risks of material misstatement.

The significance of the audit evidence obtained.

The audit methodology and tools used.


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