Would you like to outsource the hard work of complying with audit standards, improve your audit efficiency, and increase the profitability of your audit work? Then look no further.
In order to meet the requirements of the QAD or ACCA monitoring visits , most firms have implemented tight controls over their audit work. From our experience of visiting literally hundreds of firms we now see more over-auditing than under-auditing. As such, our audit file reviews can help ensure you're complying with auditing standards and implementing best practice procedures, whilst helping you improve your audit efficiency and cut down on unnecessary costs and time, thereby increasing your profitability!
Choose from many different types of audit file review:
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Call 0800 2800 433 for more details or to arrange a review
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How can SWATUK help?
Ensuring audit compliance
We work with you to ensure that you're complying with auditing standards. This can involve:
- Undertaking the annual audit compliance review for you. All you need do is read the report and implement any recommendations!
- Conducting reviews for compliance with ISQC1
- Conducting hot and cold audit file reviews — including any insisted upon by the monitoring units
- Helping you before, during and after all monitoring visits
Improving your audit efficiency
We’ll work with you to analyse past audit files, identify areas where savings can be made and assist at the planning stage of your audits to ensure that these savings are implemented. By improving your audit efficiency, we’ll also be helping to increase the profitability of your audit work.
Why choose SWATUK to undertake your audit file review?
- We are recognised by both the ACCA and ICAEW as a reputable provider of external reviews, meaning you can be confident that we will review your procedures fully in accordance with the auditing standards, ensuring you’re not left exposed in the event of a visit.
- Following your audit file review, you’ll be provided with a comprehensive written report within 2 weeks , detailing our findings as well as any action points and/or recommendations arising from the review, at no extra charge.
- During the audit file review, we’ll endeavour to identify ways to help your practice run more efficiently, help to cut down on unnecessary time and costs, and therefore improve your profitability.
- Our in-house team of technical consultants have vast and valuable experience gained from working in practice and visiting many client firms.
Types of audit file review
Audit compliance review
Auditing standards require a registered auditor to monitor compliance with the regulations at least once a year. The review covers all the necessary areas detailed within the audit regulations and, subsequently, the results from the review may be used when completing the annual return without you having to perform an additional compliance review.
Specifically, this type of review includes:
- a review of CPD and staff training records;
- a review of the results of any staff appraisals carried out during the period;
- a check on the adequacy of professional indemnity insurance cover;
- a review of fit and proper questionnaires and independence statements for partners and staff;
- a review of the adequacy of action taken following previous reviews; and
- a check on the adequacy of technical support arrangements, including consultation arrangements and a review of the technical library.
Following the review, you’ll receive a detailed report setting out the reviewer’s findings. The report will also include a copy of the completed annual audit compliance questionnaire, comments and scores on each of the files reviewed and recommendations relating to any issues raised.
Audit cold file review
With a cold file review, files can either be selected at random from invoices raised, or specific files that have been presented to the reviewer can be reviewed - the choice is yours.
Normally the cold file review would aim to:
(a) Identify whether the disclosure requirements had been properly met - incorrect disclosures are the largest subject of complaints to the Institute.
(b) Identify whether the Auditing Standards and Regulations have been properly complied with - each audit would be "scored" using a comprehensive file review checklist.
(c) Assess the effectiveness of any independent manager review and the partner review, looking for any points that should have been picked up by a manager but had not been, and likewise with the partner.
You would then be provided with a comprehensive written report following up on the visit. This report is in the form of a summary, setting out the main findings to which are attached sections covering the detailed points and the "scores" on the files. It is recommended that the detailed results are circulated to all staff so they are fully aware of the points that have been raised.
Audit hot file review
SWATUK is increasingly being called upon to provide hot file reviews for firms. The purpose of a hot review is to identify any key areas that need to be addressed prior to signing the report.
The categories for review which may be undertaken, can be described as follows:
1. Comfort reviews
A number of firms, for their largest clients (not necessarily high risk clients), feel a little exposed and want someone else to review the work before the job is complete.
2. High risk reviews
One off reviews may be required on files in circumstances where, for example, the company is being sold and the firm feels that having a review undertaken by an independent party will help to decrease their risk.
3. Training reviews
Where key audit staff have left, a manager-style review on files may be undertaken in order to train a new manager or partner.
4. Independence reviews
Some sole practitioners require an outside review to ensure that it is reasonable for them to maintain an audit assignment when independence might be called into question. This is particularly the case where individuals have been an audit partner for more than seven years.
5. Hot file reviews by post
For many practitioners who only have a small number of audits, but who have had some form of restriction placed on them - this is the best option. In many ways it creates a higher risk for SWATUK as there may not be the opportunity to discuss the job as fully with partners and staff. When completing such assignments it is vital that all relevant files are made available.
6. ISQC1 reviews
The ISQC1: “Quality control for firms that perform audits and reviews of historical financial information, and other assurance and related services engagements”, requires an independent hot review for all listed work and certain other high profile or high risk work.
Audit efficiency reviews
The standard audit cold file review is designed to ensure that the audits undertaken comply with the regulations. It is not, therefore, an efficiency review. However, the majority of our visits show more over-auditing than under-auditing. There is, therefore, scope to cut costs without cutting the quality of the work being undertaken.
Audit efficiency visits can be undertaken in one of two ways - looking back at last year's work, or looking forward to next year's.
The retrospective review takes completed assignments and seeks to determine where costs could have been reduced without adversely affecting the quality of the audit evidence. This will let you know how you could have improved with the aim of seeing the benefits next year.
The alternative is to use last year's file as the starting point for the coming year, with the visit helping to plan forthcoming assignments. See live audit planning reviews for more information on this type of visit.
Live audit planning reviews
Reviewing completed files is a necessary part of the quality control aspect of a firm, and will often raise ideas about improving the efficiency of the audit. However, some firms find it difficult to take specific examples identified during the review, and apply the principles raised to other audits.
As a result, we have developed a new type of visit. Instead of reviewing completed files, when any efficiency savings have already been lost, we can help your partners or managers plan audits that they are about to complete. In this way, the savings can be identified before the time is lost.
In this type of review we do not normally produce a follow-up report, but instead ensure that a detailed planning memorandum is produced for each file planned. This will identify the key tests on the audit, any tests or programs that may be omitted, and any alternative tests that will improve the efficiency. It will also consider the risk areas on each job, and the level of materiality.
Audit pre-regulatory reviews
The purpose of this visit is to undertake a dummy QAD ACCA monitoring review to identify any issues that still need to be addressed before the real visit.
How much does an audit file review cost?
Prices for our audit file reviews start from just £1070 + VAT per on-site day (SWATUK Full Member firms can enjoy a 10% discount on these rates) plus expenses, and don’t forget, this price includes the production of a detailed written report, following the review.
More information and bookings
For more information on any of our audit file reviews, or to arrange a review, call us today on 0800 2800 433.