FUNCTIONS OF WORKING PAPER

Aid in the planning

performance &
Provide for the review of
engagements Provide the
internal audit
principal support
activity’s quality
for engagement
assurance &
results.
improvement
Engagement
program.
working
papers
generally: Document
whether
Facilitate
engagement
third-party
Support the objectives were
reviews.
accuracy & achieved.
completeness of
the work
performed.
What Working Papers Should Be:

 Set out the objectives

 Show clarity
 Be indexed
 Support the audit opinion or decision
 Use pro-forma
 Be cross-referenced
 Be economically used
 Be headed up
 Clearly show any impact on the audit report
 Be signed by the auditor and the reviewer
 Show the work carried out
 Show the source of information or data
 Show any impact on the next audit
 Be complete
 Be consistent
 Include summaries whenever possible
 Types of Working Papers
1. Audit Programme
2. Financial reports ( IS/BS/CF)
3. Account analysis
4. Account Schedules/Summaries
5. Adjusting/reclassification entries
6. Memos, contracts, budgets, Board resolutions,
management reports
7. Correspondences with third-parties
8. Minutes of management’s meeting
9. Confirmation replies
 Judgement Sampling

The auditor uses

knowledge of systems
and people to select
items more likely to
exhibit certain features.
Those who are willing to participate or have
vested interest in doing so.
 Statistical Sampling
 Statistical sampling uses the laws of
probability to compute sample size and
evaluate results

 The auditor is able to use the most

efficient sample size and quantity
sampling risk.
 Advantages of Statistical
Sampling
 Results may be defended against bias.
 A defined sample size is provided.
 One may safely extrapolate the results and
apply them to wider population
 The techniques is repeatable and one would
expect a similar result from any repetition.
 It forces one to define and consider the
attributes of the population.
 Computers make statistical sampling more
convenient to use.
 The level of confidence may be predefined.