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Everything you need to know about external auditor's worksheets

In previous articles, we talked about the importance of auditing and how an external auditor can achieve the quality of an external audit. One of the most important things that enable the auditor to achieve efficiency and quality is to infer the validity of cash and balances mentioned in the financial statements with papers and documents that they support, which is called external auditor worksheets. 

These are the same conditions set by the Identification Standard 2310, which means that the auditor mentions the same information in his reports. Therefore, it is the same information to be documented, and this information is mentioned through papers or so-called external auditor worksheets.
He also specified that the person responsible for developing and organizing the policies of audit worksheets is the Executive Director, while those responsible for preparing these papers are the auditors
auditing the audit worksheets and ensuring the integrity of the data belongs to the supervising officer

External auditor's worksheets

The external auditor's working documents are considered one of the essential pieces of evidence to support his opinion written in his final external audit report. International Accounting and Auditing Standards have confirmed this. According to Standard No. 2330 on documentation of information, which stressed that the external auditor must be required to provide documentation of his information to support the findings, recommendations, and conclusions of the audit function, provided that such information has the following characteristics
Adequacy
Reliability
Connected
Helpful

What are the contents of the external auditor's worksheets

External audit worksheets vary depending on several factors, including are Mission - Mission goals - Company needed worksheets.

In general, documents include everything related to the audit function from the beginning to the end, such as planning papers, evaluation papers on the efficiency of control tools, papers related to policies and procedures, papers on proposed findings and recommendations, and final papers related to follow-up and control

Working papers may include forms, drawings, charts, and forms. This can be summarized as working papers cover everything related to the task (objectives - facts - conclusions), including:

A copy of the balance matches the previous year’s financial statements

A copy of the balance matching balances with the current year's audit balance

Objectives of the audit mission.

Procedures that have been followed to achieve the goals set

Audit details for each audit item

Evidence that the auditor has accessed and based on his final report

Observations and conclusions reached by the external auditor

Well-thought-out recommendations to eliminate deficiencies.

What qualities should be available in external auditor worksheets

Bookmarks: this means the establishment of references indicating documented sources of said information so that all said data become linked to its sources
The supervisor signs each reference worksheet
Each paper should contain a title, date, and task performed at the time
Organize the format of files

?How does an external auditor organize his worksheets

Worksheets are often split into two files, either a permanent file or a current file for audit

Permanent file

It contains all worksheets that do not change as time changes within the department to audit, such as policy methods and procedures.

Current file

It includes all task papers that change by changing management in place of the task.

:External auditor rights when placing worksheets

Access to working papers is only available to external auditors working on the task. To allow others to view them, top management must obtain permission.

Right to develop policies: The policy development function is assigned to the Executive Director for an external audit, and the supervisor supervises the implementation of policies.

The right to observe the standards of regulatory and supervisory bodies

In the case of consulting assignments, there must be supervision of the tasks to achieve efficiency, quality, and team development

Risk Matrix in External Audit

Auditing steps

Audit steps vary depending on the accounting program that the external auditor chooses to apply. However, in general, the steps are as follows

Recognizing the nature of the company’s business, whether its legal entity, type of business, accounting system, and organizational structure of the company, and in light of what the auditor understands determines whether he accepts the task of auditing this company or rejecting it.

Fully understand the components of the customer’s internal control system, whether they are fully implemented, whether the client’s internal control systems, accounts, and departments accept external audits, or there are difficulties facing the external auditor.

Inform external references about control and control systems in such a way as to determine the reliability of the data and information mentioned in the books and calculate the degree of risk accurately

Conduct audit tests that enable the auditor to determine the appropriate time to conduct an audit, the time required to carry out audit work, external auditor worksheets, and the necessary sample size

Conducting an external audit process, which includes

 audit the initial balance and match it with the natural balance

 Audit balance for the financial period

 Ensure that registered account balances are correct

Choose a random sample and match it with the journal

 Check invoice prices and product price lists

Evaluate the outcome of the audit work and determine the conclusions drawn from the audit to determine the rule on which it will rely when developing its final opinion on the final financial and accounting statements

Preparing the final external audit report in which the auditor gives an opinion on the fairness and validity of the accounting statements, the list of financial position and budget, as well as the result of the work performed by the company during the financial period and the extent to which the company has succeeded in reaching its objectives

Internal Auditor Tasks

ECPA office is the most prominent accounting office in Egypt and the Arab world; it is a massive team of the best-certified specialists and consultants providing the best accounting, auditing, and tax services, ensuring the performance level within your company and ensuring the safety of its operations in the least time and with the highest quality of services

Our team provides all auditing and auditing services by experts practicing the profession for decades and are up-to-date with the latest electronic accounting and auditing programs and applications to ensure the lowest cost and eliminate errors

The tasks offered by the ECPA team are different according to the size and nature of the company’s business, but one of the most critical tasks we offer are

Audit and audit accounts

Drawing the form of the company’s financial plans for the next financial period or periods

Analyze and evaluate financial statements and accounts

Follow up and control internal auditing and auditing tools and methods

Prepare reports with the auditor’s accounting opinion and the audit process results and submit them to those concerned

Provide appropriate feedback and recommendations to manage financial risks and expected costs

Communicate with audit committees and departmental staff to exchange experiences and ascertain information

Prepare appropriate plans with the company’s objectives.

Evaluate the company’s actual performance during previous financial periods objectively and fairly

Collect as much financial information about the company

Cooperate with auditors and accountants within the company and work in a team spirit to achieve its objectives and raise its profits

Assure members of the Board of Directors that accounting standards and international laws carry out the company’s operations in force within the country

Search for all gaps, robberies, and errors made during the previous period or periods to face them and solve them in the best appropriate way and not repeat them

Because your best interest is our ultimate goal, we offer the first consultation free of charge; please feel free to contact us

our team - Amer Ibrahim

Member of the Board of Directors for Auditing