Audit file
reviews
ordered by
ACCA
Audit file reviews ordered by
ACCA: contents
Audit file review orders
Key features
Basis of ACCA’s audit file assessment
Guidance for firms (and “hot”
reviewers)
Examples of “hot” review deficiencies
Audit file review orders
Ordered by Admissions and Licensing
Committee or Regulatory Assessors
Ordered after unsatisfactory outcome
to a monitoring visit
Principal objective – provides
safeguard on audit reports issued
Secondary objective – provides
training to firm on ISA compliance
Audit file review orders
Committee or assessor decides
number of files to be reviewed
Practice Monitoring staff decide which
files to be reviewed
All reviews normally “hot”
Firm chooses reviewer from ACCA’s
list of Approved Training Companies
Audit file reviews: key features
Firm not required to submit reviewer’s
reports to ACCA
Instead, ACCA conducts early re-visit
At re-visit ACCA reviews audits –
some subject to “hot” review, some
not
Quality of “hot” review assessed by
comparison with ACCA’s review
Basis of ACCA’s audit file
assessment
Based on concept of “reasonable
assurance” (ISA 200)
ACCA identifies all deficiencies and
considers each individually
ACCA considers risk of material
misstatement remaining undetected
Therefore one significant deficiency
may render audit unsatisfactory
Guidance for firms (and “hot”
reviewers)
Agree scope, responsibilities and
terms in engagement letter
Reviewer to understand firm’s audit
procedures
Ideally, reviewer should assess audit
plan before work commences
Review must be documented
Guidance for firms (and “hot”
reviewers)
Important to identify relative significance of
deficiencies identified
Reviewer to identify key points to be
resolved before issue of audit report
Clear conclusion as to
satisfactory/unsatisfactory
Continuation of some “hot” or cold reviews
advisable even if outcome of next visit is
satisfactory
Examples of “hot” review
deficiencies
Failure to identify all significant
deficiencies
Giving the firm benefit of doubt where
work recorded in inadequate detail
Additional work recorded against
review points – not on working papers
Examples of “hot” review
deficiencies
Overall conclusion not recorded – or
inconsistent with deficiencies identified
Marking scheme used to determine
overall conclusion
No guidance given on how to rectify
deficiencies
Concluding remarks
Reviewers who fail to provide effective
reviews are removed from ACCA’s list
of Approved Training Companies
Reviewers that succeed in assisting
firms to “pass” next monitoring visit are
often asked by firms to continue to
provide training/review services