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Cost Auditing Standards Cost Audit Documentation (102) Part-II

Cost Auditing Standards [ Cost Audit Documentation (102)] Part-II - Accounting - Auditing - By: - Rakesh Singh - Dated:- 12-1-2016 - Cost Auditing Standards [Cost Audit Documentation (102)] - Part-II 1.Introduction : In continuation of our effort to make notified Cost Auditing Standards readable, next in line is the Cost Auditing Standard on Cost Audit Documentation (102). The governing idea behind this standard immediately put in place after Standard on Planning an Audit of Cost Statements (1 .....

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incorporated in our discussion. 2.The Objective: of this Standard (Cost Audit Documentation -102) is to guide the members to prepare documentation that provides: (a) A sufficient and appropriate record of the basis for the Cost Auditor s Report; and (b) Evidence that the audit was planned and performed in accordance with Cost Auditing Standards and applicable legal & regulatory requirements. Though This Standard deals with the cost auditor s responsibility to prepare audit documentation for .....

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pliance. Another very interesting aspect comes out from the plain reading of the standard is, intent of the regulator to put in place peer review mechanism. For the record, peer review is not yet implemented by the regulator but as discussed, seems inevitable. 3. Requirements: envisaged in this standards: The cost auditor as part of the audit documentation shall record audit procedures performed, relevant audit evidence obtained, and conclusions reached. (Refer 6.1) The Cost Auditor shall prepar .....

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nt professional judgments made in reaching those conclusions. (Refer 6.7 & 6.8) The Cost Auditor shall record the discussions of significant matters with client personnel and outsiders.(Refer 6.9). The Cost Auditor shall record any departure from the standard requirement in a Cost Auditing Standard. (Refer 6.11) In documenting the nature, timing and extent of audit procedures performed, the Cost Auditor shall record the characteristics of the specific items or matters tested, the persons res .....

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in an audit file.(Refer 6.16) 4. Some important and relevant terms / definitions used in the standard are : Audit documentation: Audit Documentation means the records, in physical or electronic form, including working papers prepared by and for, or obtained and retained by the Cost auditor, in connection with the performance of the audit. As per Manual on QRB which is applicable on auditors in such audit and relevant here [ Audit documentation refers to the record of audit procedures performed, .....

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umentation. Audit documentation should be completed in time even though no time limits as such are normally prescribed by any statute. It may be considered to be a good practice to complete audit documentation within a period not exceeding 45/60 days from the date on which the audit report is rendered. In case of statements are authenticated / certified by practicing cost accountant, the period may be restricted to 15 days from the date on which certificate is signed. The audit documents should .....

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should have proper and safeguarded password protection and back up mechanism. The audit documents should be divided in sections and properly indexed with serial numbers. The audit documentation should be retained depending upon the relevance and significance of the same in relation to the matter authenticated or certified by the auditor. Normally the audit documentation should be retained for a minimum period of 5 years from the date of signing the report. However, the legal provisions or regul .....

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