The time to start auditing many businesses thinks that it is when the auditors come down to work at their businesses. However, this is not accurate.
Is there a requirement to sign an audit engagement? #
If your business belongs to Subjects required to be audited financial statements, with a fiscal year ending on December 31, the deadline for signing an audit contract is December 12 of that year. If the fiscal year ends on June 01, the deadline for signing the audit contract is May 12 of that year.
This is based on the provisions of Clause 2, Article 9 of the 2011 Law on Independent Audit which clearly states:
"Auditing contract of annual financial statements of enterprises, organizations is required to audit financial statements must be concluded at least thirty days before the end of the annual accounting period".
When did the audit start? #
The cycle of the audit according to the accounting program is divided into 03 stages: (1) Audit plan; (2) Performing audits; and (3) Summarizing, concluding and making reports.
Light green vertical columns indicate audit activities throughout the entire audit period. The dark blue box is the audit steps and the working paper of this step is required to be signed and reviewed by the BOM Member in charge of the overall audit.
The surrounding pink boxes are the factors that govern the entire audit. The darker the colored boxes, the more important the role played throughout the audit cycle.
According to the above procedure, the time to start the audit is immediately after signing the audit contract. Depending on each time, at each stage of the audit, different procedures will be performed, and these procedures can be performed before going down to audit at the client.
Things businesses need to pay attention to before an audit #
- Set the requirements on the time limit for report issuance, agree on the implementation time of each detailed work with the auditor;
- To properly perform the tasks according to the timelines and times agreed between the enterprise and the auditor;
- Carry out an inventory of assets at the end of the annual accounting period in accordance with the Law on Accounting and witness the inventory of the audit party;
- Explain the difference detected during the inventory process and make inventory records to provide to the auditors;
- Before the accounting audit, it is necessary to complete the accounting records, close the accounting books and export data files;
- Print and sign the financial statement in hard copy, or export a soft file to certify that this is the company's annual financial statement and send it to the auditor when performing the audit;
- Prepare sufficient documents according to the list of documents to be provided sent by the auditor;
- Arrange invoices and documents in order to facilitate searching for records during the audit;
- Prepare personnel to coordinate with the audit party in the process of implementing work.
With the detailed contents of the audit time as well as other related issues, EXPERTIS hopes to bring complete information to businesses. If there are other issues that need assistance, please contact our Consulting Department for answers.