Working Papers and Auditor’s Opinion: A Comprehensive Guide
1. Concept of Working Papers
Working papers are the set of ballots and reliable documentation containing data and information obtained by the auditor in their review, and the description of tests and the results thereof upon which supports the view that issues to conclude its report.
2. Purpose of Working Papers
The overall objective of the working papers is to help the auditor to adequately ensure that an audit was done according to generally accepted auditing standards. Working papers, as they correspond to the current year’s audit are a basis for planning the audit, a record of the accumulated evidence and test results, data to determine the appropriate type of audit report and database analysis for supervisors and associates.
3. Types of Working Papers
There are two types of working papers:
- Permanent reference file: Contains information for subsequent audits.
- Bundle of audit work papers supporting the work of the audit.
4. What is a Permanent Archive?
A permanent archive aims to bring together historical data or continuous nature concerning this audit. These files provide a convenient source of information about the audit that is of continuing interest from one year to another.
5. Files Present in a Permanent Archive
The files present in a permanent archive include all applicable papers per year being audited. The types of information included in this file include audit programs, general information, working trial balance, adjusting entries and reclassification and support cards.
6. Features of Working Papers
Each working paper must be identified with information such as customer name, period covered, description of contents, the signature of who prepared it, the date of preparation and the index code.
Working papers are cataloged and cross referenced to help file and organization.
The complete work papers clearly indicate the audit work performed.
Each working paper includes enough information to meet the objectives for which it was designed.
The conclusions that were reached on the segment of audit that is being considered also express themselves clearly.
7. Ownership of Working Papers
The working papers are owned by the auditor.
8. Concept of Audit
An audit is the document or paper records the work done by the auditor on an account, item, area or operation subject to review.
9. Types of Audit Ballots
Audit ballots can be customary or possible.
10. Traditional Audit Ballots
Traditional audit ballots are those whose nomenclature is standard and its use is very common and widely known.
11. Types of Traditional Ballots
- Cedulas .- What are summary or tabular summaries of concepts and / or homogeneous figures from one account, item, area or operation.
- Cedulas analytical .- They put the details of the concepts that form a ballot summary.
12. Possible Audit Ballots
Possible audit ballots do not obey any sort of pattern naming standard and names are assigned at the discretion of the auditor and comments can be cards, work program, adjusting entries, cards, cards reclassifications, confirmations, letters of safeguard, cards recommendations, controlling the time of the audit, pending cases, among many more types of identification cards that might arise.
13. Permanent File
The permanent file contains relevant information that must be retained continuum that extends beyond any particular audit period.
In the introductory part of this file must include a certificate that will serve as an index or contents that indicate the different sections that comprise it, same as, in turn, will be accommodated in chronological order according to the date of collection. Therefore it is essential to adequately plan the information it must contain this file, thus providing growth.
It is important that the end of the audit work will make a final review of the information contained in the permanent file to ensure that whatever it (the opinion of the auditor) is considered desirable to maintain.
14. Purpose of the Permanent File
Permanent files are intended to gather historical data or continuous nature relating to this audit. These files provide a convenient source of information about the audit that is of continuing interest from one year to another.
15. Contents of the Permanent File
- General program of the audit work and its evolution.
- Abstracts or copies of company documents that are of continuing importance as the charter, statutes, legal agreements and issuance of bonds and purchase contracts. Contracts are pension plans, leases, stock options, etc.. Each of these documents is relevant to the auditor for many years in force.
- Fiscal and legal obligations that the entity is subject ..
- Copy or summary of the major contracts that required the institution.
- Analysis of previous years of accounts such as long-term liabilities, shareholders’ capital accounts, goodwill and fixed assets. Having this information on file permanently analyzing the auditor to focus only changes the balance of this year while retaining for further study the results of audits from previous years in an accessible way.
- Changes in asset accounts capitalized and the related depreciation and / or amortization.
- Information related to the knowledge of the internal control structure and assessment of control risk. Includes charts, flow programs, questionnaires and other information of internal control, including list of controls and limitations on the system.
- The results of analytical procedures for prior years’ audits. These data are reasons and percentages calculated by the auditor and the total balance or the balance per month for selected accounts. This information is useful because it helps the auditor to decide whether there are unusual changes in account balances this year that should be investigated more extensively.
- Operating systems in use, such as general accounting systems and cost accounting system (including both chart of accounts, and instructive guide contabilizadota counting).
16. What is an Opinion?
An opinion is the document that supports the CPA under the rules of his profession on the nature, scope and outcome of the review sobe financial statements of the entity concerned.
17. What an Auditor Expressed Through the Opinion?
An auditor expresses through the opinion:
- That has examined the financial statements of an entity, identifying them.
- How conducted its review, typically by applying rules of authorship.
- What conclusion it deserves its audit http://www.monografias.com/trabajos14/auditoria/auditoria.shtml, indicating whether such financial statements present fairly the assets, financial and economic entity, in accordance with rules current accounting, which constitute the framework.
18. What is the End of the Review of Financial Statements?
R = express an independent professional opinion on whether such statements present the financial position, results of operations http://www.monografias.com/trabajos6/diop/diop.shtml>, variations in capital www.monografias.com/trabajos13/capintel/capintel.shtml> accounting and changes in financial position of a company http://www.monografias.com/trabajos11/empre/empre.shtml>, according to accounting principles generally accepted http://www.monografias.com/trabajos11/conunos/conunos.shtml>.
19. What requirements must submit a certified public accountant to obtain the registration of an opinion?
R = The public accountant who wishes to obtain registration with the Ministry of Finance http://www.monografias.com/trabajos7/regi/regi.shtml> to exercise Dictamination must submit a request to the competent tax authorities, accompanied by certified copies of http://www.monografias.com/trabajos14/comer/comer.shtml> following documents:
The accrediting their Mexican nationality.
Professional certificate issued by the Ministry of Education Public http://www.monografias.com/Educacion/index.shtml>.
School certificate issued by public accountants stating http://www.monografias.com/trabajos11/conge/conge.shtml> as an active member, issued within two months prior to the filing.
It must be stated under oath that that is not subject to process http://www.monografias.com/trabajos14/administ-procesos/administ-procesos.shtml> or convicted, for crimes http://www. monografias.com/trabajos10/delipen/delipen.shtml> character or for crimes prosecutor http://www.monografias.com/trabajos10/carso/carso.shtml> http://www.monografias.com/trabajos10/ delipen / delipen.shtml> intentional warrant corporal punishment.
Once granted registration 20.Una What you should do the counter?
R = It shall inform the tax authority http://www.monografias.com/trabajos2/rhempresa/rhempresa.shtml> any change in http://www.monografias.com/trabajos2/mercambiario/mercambiario.shtml> http://www.monografias.com/trabajos11/basda/basda.shtml> data contained in your application and check to the authority http://www.monografias.com/trabajos2/rhempresa/rhempresa.shtml> responsible, within the first three months of each year, which is an active member of a professional organization and submit to a test that supported and passed to the tax authorities in the proof that is current on the tax provisions or in the absence of the latter, show proof of compliance with the standard continuing education http://www.monografias.com/Educacion/index.shtml> issued by his professional organization or academic record update issued by that school or association.
21. What should describe an opinion at the end of the audit?
R = The amendments to the document when there are limitations on the scope of work and / or deviations http://www.monografias.com/trabajos6/etic/etic.shtml> accounting principles.
22. How much time you have to submit the advice?
R = The opinion on the financial statements, magnetic disks and other documents http://www.monografias.com/trabajos14/comer/comer.shtml> be submitted within seven months of the fiscal year ending concerned.
23.Menciona some of the causes of warning if you have an opinion wrong.
R = A). Submit incomplete documents and attachments that make up the prosecutor’s notebook of financial statements, including as part of the review report of the fiscal situation of the taxpayer,
B). Of the opinion that the information presented on flexible magnetic disks, in two points, no match between a record and another.
C). Submit incomplete simplified tax opinion applied to grantee.
24. What information the tax authority may require the public accountant and the company dictated?
R = I. – The accountant who has made the opinion that:
Any information under the Code and this regulation should be included in the audited financial statements for tax purposes.
The exhibition of the work papers prepared in connection with the audit http://www.monografias.com/trabajos14/auditoria/auditoria.shtml> practiced, which, in any case, it owned www.monografias.com/trabajos16/romano-limitaciones/romano-limitaciones.shtml> public accountant.
The information deemed relevant to ensure compliance with tax obligations of the taxpayer.
The exhibition http://www.monografias.com/trabajos11/teosis/teosis.shtml> systems and accounting records and original documentation, in those cases where this is deemed necessary.
II .- The taxpayer, information and documents referred to in paragraphs c) and d) of the preceding section, this requirement shall be in writing, with copies to the public accountant.
III .- A related party or jointly liable taxpayers, information and documentation they deem necessary to verify if certain disclosures in the report and other documents.
25. What is the utility an opinion?
R = The opinion is not to dictate the only positive things, but in the opinion must include all the negatives that might somehow affect the financial statements.
26. How do you know the kind of negative notes in an opinion?
R = It is commonly known as the provisos
27. What is a proviso in an opinion?
R = is the mechanism that has the tax inspector, not just to inform whoever is competent negative events of the company, but to salvarsu liability to the facts and practices of the company, so the tax inspector should not hesitate do all the necessary qualifications, because that is exactly its role and if he does will be responsible for the negative consequences that these omissions caused to third parties.
28.Menciona some of the functions of a tax inspector
R = is a function of all tax inspector to make sure that the acts and operations developed by the company conform to the provisions of the statutes and commandments of the general assembly of shareholders and board of directors, which in turn should be adjusted to the law . The functions of the tax inspector, is also verified that the company complies with the requirements of this with the various state entities that monitor, which means being aware of compliance with formal and substantial obligations with respect to tax, duty to report information that entities requesting guards, etc.
29.Menciona the basic elements of an opinion
R = Title
Recipient
Chapeau
Paragraph of scope
Paragraph of the opinion
Date and signature of the opinion
30. What Should paragraph of title?
R = To enhance auditor independence that supports your opinion and obviously the test was carried out in accordance with generally accepted auditing standards. Not applicable to use the name of the External Auditors opinion because no mention of independent quality is fundamental and very important.
31. To whom it may concern the opinion?
R = The opinion is addressed to the first level of the company or entity under examination, which normally are the shareholders and directors or similar charges which ordered the hiring of professional services of independent auditors.
32.Menciona opinions rates
R = clean opinion or unqualified
Opinion with caveats
Adverse opinion
Abstaining opinion opinion
33. What is a clean opinion or unqualified?
R = is when the auditor expresses the opinion of the financial statements present fairly the financial position and results of operations of the institution in accordance with accounting principles and applied on a consistent basis in the previous year.
34. When the auditor issues an opinion with exceptions?
R = When your entity’s financial statements presents fairly its financial position exceptions or limitations which do not significantly affect or significantly the financial position or results of operations shown.
35. When does an adverse ruling?
R = When the auditor has come to the proviso that the financial statements present fairly the financial position and results with the principles in accordance with accounting principles consistently applied.
36. What is an opinion abstention from giving an opinion?
R = is when the auditor is not able to give a professional opinion on the financial statements taken as a whole will get a say clearly explaining the reasons for not been able to dictate this situation occurs when the s restrictions and implementation of Audit procedures are important to limit the scope of the review