Execution of the audit process

This article presents the methodology that the internal auditor must apply in the execution of the Audits, which is based on a set of tools and techniques that make up part of the general procedures of their work to obtain information and analytical methods. what you will use to achieve your intended objectives; the importance of both elements, their requirements, their purposes and the most important elements to take into account in their preparation so that they demonstrate the auditor's statements. Its design is conceived to obtain sufficient, relevant and competent evidence, a basis that guarantees the quality of the Audit Report.

Execution of the Audit process

Methodological guidelines for the execution of audits

Decree Law No. 159 On the Audit of Cuba, defines the audit as a systematic process, which consists of objectively obtaining and evaluating evidence on the statements regarding acts or events of an economic-administrative nature, in order to determine the degree correspondence between these statements and the established criteria, and then communicate the results to interested persons.

As the audit is a systematic process of obtaining evidence, there have to be sets of logical and organized procedures that the auditor follows to collect the information. Although the appropriate procedures vary by entity, the auditor will always have to adhere to the general standards established by the profession.

The definition states that the evidence is obtained and evaluated objectively. Therefore the auditor should undertake the work with an attitude of mental independence and neutrality.

The evidence examined by the auditor consists of a wide variety of information and data to support the reports prepared. The definition is not restrictive as to the nature of the evidence reviewed, rather it implies that the auditor has to use professional judgment in selecting the appropriate evidence. He must consider any element that allows him to make an objective evaluation and express an opinion of a professional nature.

The role of the auditor is to determine the degree of correspondence between the evidence of what actually occurred and the reports that have been submitted of those events. Report users, who generally do not know directly what actually happened, want the auditor to assure them that the information presented is an objective statement of actual events and their results.

During the execution of the Audit, the auditor must ensure compliance with the Generally Accepted Auditing Standards, and knowledge and mastery of the Audit Manual of the entity to which he is subordinate, since the quality of the service to be provided and the possible risks in the fulfillment of the proposed objectives.

In this sub-process (Execution), the Planning conceived in time and with the required quality must be fulfilled, since the fulfillment of the rest of the sub-processes will depend on it:

• Preparation of the Report and; Presentation of the File

It is important to remember that it will be the maturity of the auditor's judgment (obtained from experience), which will allow him to achieve sufficient moral certainty to determine that the fact has been reasonably verified, so that as it decreases (decreases) Through the different levels of experience of the auditors, moral certainty will be poorer. That is why the preparation, advice and supervision by experienced auditors is required to achieve the expected quality in this sub-process.

It is known that when planning the Internal Audit, the auditor must define the objectives, scope and methodology aimed at achieving these achievements, and it is precisely in this sub-process where they must be met, as it must be achieved; identify the most important issues that must be taken into account and that respond to the specific needs of the competent authority.

The scope refers to the limit of the Internal Audit, that is, the degree of extension of the tasks to be executed; it can include areas, question and periods to examine.

The methodology of this Chapter includes the general procedures that the internal auditor must apply in his work to obtain information and the analytical methods that he will use to achieve the planned objectives; which has been designed to obtain sufficient, relevant and competent evidence to be included later in the reports.

Accordingly, when executing the engagement, internal auditors should consider:

• the objectives of the activity being reviewed and the means by which it controls its performance; the significant risks of the activity, its objectives, resources and operations, and the means by which the potential impact of the risk is kept at a level acceptable; the adequacy and effectiveness of the risk management and Internal Control systems of the activity; and the opportunities to introduce significant improvements in the risk management and Internal Control systems of the activity.

Consequently, they constitute the framework of reference for the execution of the actions related to the Audit or Consulting services, which have been foreseen. The results obtained when these procedures are applied are the main source of the content of the corresponding report.

Evidence and working papers

Evidence

They include all influences from the mind of an auditor that affect his judgment about the accuracy of propositions submitted to him for review.

The auditor does not seek absolute proof. It is in accordance with the requirements of the engagement, assuring a responsible and competent person of the reasonableness of the financial statements of the management and / or the adequacy of the activities of the Internal Control.

Sufficient, competent and relevant evidence must be obtained to support the judgments and conclusions made by the auditor.

The evidences are classified into:

• Physical evidence: it is obtained by inspection and direct observation of activities, goods or events; This evidence can be in the form of documents, photographs, graphs, charts, maps, or material samples. When physical evidence is critical to achieving the objectives of the Internal Audit, it must be adequately and timely confirmed by the internal auditors. Documentary evidence:it can be physical or electronic. They can be external or internal to the organization. External evidence includes, among others, letters, supplier invoices, contracts, external audits and other reports or opinions and confirmations from third parties. Internal evidence originates from the organization, includes, among others, accounting records, correspondence sent, job descriptions, plans, budgets, internal reports, internal policies and procedures. The reliability of the documentary evidence has to be assessed in relation to the objectives of the Internal Audit. Testimonial evidence:It is obtained from other people in the form of statements made in the course of investigations or interviews. These statements can provide important clues that cannot always be obtained through other forms of internal audit work. Confirmation is required if they are to be used as evidence, through: - written confirmation from the interviewee; - analysis of multiple independent sources that reveal or explain the facts analyzed; and - subsequent verification in the documents. Analytical evidence: arises from the analysis and verification of the data. The analysis can be carried out on calculations, performance indicators and trends reported in the financial or other reports of the organization or other sources that can be used.Comparisons can also be made with mandatory standards or levels of the sector to which the organization belongs. Computer evidence: can be found in data, application systems, facilities and supports, technologies and computer personnel. To determine the reliability of the computer evidence, the Internal Auditor: - May carry out a review of the general controls of the automated systems and of those related specifically to their applications, including all the tests that are permitted; and - if you do not review the general controls and those related to the applications or find that those controls are not reliable, you may perform additional tests or use other procedures. The basic requirements of the evidence are related to sufficiency, competence and relevance.

The evidence is sufficient when, by the results of the application of one or more tests, the internal auditor can acquire reasonable certainty that the disclosed facts are satisfactorily verified. Sufficiency is the measure of the number of tests, verifications or verifications to be carried out, with respect to certain criteria and their reliability. The factors that indicate the strength of the tests, verifications or verifications to be carried out may be linked, among others, to:

• level of importance of the matter to be verified; degree of risk associated with the adoption of an erroneous conclusion; results shown in the Single File; and the organization's sensitivity to the matter to be checked.

Competence refers to the fact that the evidence must be valid and reliable. The internal auditor must carefully consider whether there are reasons to doubt the validity and completeness of the evidence. If so, you must obtain additional evidence or disclose that situation as a limitation on the scope of the Internal Audit. The validity, reliability and integrity of the evidence can be evaluated taking into account the following factors:

• the evidence obtained from external sources is more reliable than that obtained from the organization itself; the evidence obtained when an adequate internal control system has been established is more reliable than that obtained when the internal control system is deficient or not established; evidence obtained physically by examination, observation, calculation, or inspection is more reliable than that obtained indirectly; original documents are more reliable than copies; oral evidence verified in writing is more reliable than oral evidence; and the testimonial evidence obtained in circumstances that allow the person to express themselves freely deserves more credit than that obtained in compromising circumstances.

The relevance of the evidence refers to the relationship between the evidence and its use. The information used to demonstrate or refute a fact is relevant if it is clearly and logically related to that fact. It is also closely related to the objectives established in the Internal Audit and the direct and clear link that must exist between them and the analyzed evidence.

The criteria that act on the sufficiency, competence and relevance of the evidence to be obtained and, consequently, on the performance of the work of the internal auditors, are those of Relative Importance and Probable Risk.

The identification of the level of Relative Importance and probable Risk by the internal auditors is a matter of professional judgment, which can be determined taking into account, among others, the following questions:

• the sensitivity, the strategic or national interest, the social impact of the organization's products, services, activities or operations; applicable legal and regulatory requirements; the consideration of issues such as the attitude, aptitude, authority and responsibility of the leaders and other staff; They necessarily involve considerations related to the quality (nature) and quantity (amount) of the evidence examined in relation to the objectives established in the Internal Audit.

Work papers

The basis for an auditor's opinion on the financial statements is the review that is performed in accordance with generally accepted auditing standards. The business rules require that sufficient and competent evidence be obtained through inspection, observation, investigation, and confirmation as the basis for the auditor's opinion. Accordingly, the auditor's opinion depends on obtaining and evaluating sufficient, competent, and relevant evidence. The study of the declarations of the administration and the essential characteristics to consider valid the data and the information as audit evidence. The various types of evidence available in support of management's statements are evaluated for their reliability, relevance, and other essential characteristics.These are the different techniques used by auditors to obtain audit evidence, which will be documented in the audit procedures with the information reviewed, in the form of working papers.

Records of the different types of evidence accumulated by the auditor are known as working papers. Whatever the form of the evidence and whatever the methods used to obtain it, some form of recording should be made and maintained in the working papers.

The work papers are records kept by the auditor of the applied procedures such as developed tests, information obtained and pertinent conclusions reached on the job. Some examples of working papers are audit schedules, reviews, memoranda, confirmation and declaration letters, summaries of entity documents, and papers prepared or obtained by the auditor. Working papers can also obtain the form of information stored on tapes, films or other media.

The exact format of the working papers varies with the size, complexity and circumstances of each audit engagement. Furthermore, each auditor, or Audit Management Unit, generally has certain preferences for the exact way in which the working papers should be prepared. The beginning auditor receives instructions in formal training sessions or from the supervisor on the job. This Document refers above all to the general aspects of work papers, and should be considered as a guide for the work, in which we can consult and adapt to the conditions and characteristics of each work ordered and not necessarily as a model that is must adopt.

The working papers (paper, audiovisual or digital format) constitute the link between the planning and execution work and the report that is prepared. Therefore, they must contain the necessary evidence to support the findings, conclusions and recommendations presented in the report.

The main requirements to take into account are:

• express the objectives, scope, methodology and results of the Internal Audit; include those programs that are required to be specifically drawn up for the execution of the Internal Audit; be complete and accurate so as to duly support the findings, conclusions and recommendations; and demonstrate the nature and scope of the work performed. Concision is important, but clarity and integrity should not be sacrificed for the sole purpose of saving time or paper; clear enough, understandable and detailed so that a third party, who has not had a direct relationship with Internal Audit, is able to substantiate the conclusions and recommendations, through their review. They should not require oral explanations; be legible and orderly,otherwise they could lose their value as evidence. They must contain adequate indexes and references, contain the identification of the meaning of the revision marks used by Internal Auditors, in cases where these are not established centrally; and contain relevant information, that is, limit itself to matters that are pertinent and important to fulfill the objectives of the entrusted work. Each level must establish procedures to guarantee that the work papers are safeguarded and preserved during the time established by the Law. In the course of said term, a new Internal Audit has not been executed, the working papers must be kept until it is executed, at which time it will be analyzed whether or not to keep all or part of them.They must contain adequate indexes and references, contain the identification of the meaning of the revision marks used by Internal Auditors, in cases where these are not established centrally; and contain relevant information, that is, limit itself to matters that are pertinent and important to fulfill the objectives of the entrusted work. Each level must establish procedures to guarantee that the work papers are safeguarded and preserved during the time established by the Law. In the course of said term, a new Internal Audit has not been executed, the working papers must be kept until it is executed, at which time it will be analyzed whether or not to keep all or part of them.They must contain adequate indexes and references, contain the identification of the meaning of the revision marks used by Internal Auditors, in cases where these are not established centrally; and contain relevant information, that is, limit itself to matters that are pertinent and important to fulfill the objectives of the entrusted work. Each level must establish procedures to guarantee that the work papers are safeguarded and preserved during the time established by the Law. In the course of said term, a new Internal Audit has not been executed, the working papers must be kept until it is executed, at which time it will be analyzed whether or not to keep all or part of them.contain the identification of the meaning of the revision marks used by the Internal Auditors, in those cases where they are not centrally established; and contain relevant information, that is, limit itself to matters that are pertinent and important to fulfill the objectives of the entrusted work. Each level must establish procedures to guarantee that the work papers are safeguarded and preserved during the time established by the Law. In the course of said term, a new Internal Audit has not been executed, the working papers must be kept until it is executed, at which time it will be analyzed whether or not to keep all or part of them.contain the identification of the meaning of the revision marks used by the Internal Auditors, in those cases where they are not centrally established; and contain relevant information, that is, limit itself to matters that are pertinent and important to fulfill the objectives of the entrusted work. Each level must establish procedures to guarantee that the work papers are safeguarded and preserved during the time established by the Law. In the course of said term, a new Internal Audit has not been executed, the working papers must be kept until it is executed, at which time it will be analyzed whether or not to keep all or part of them.and contain relevant information, that is, limit itself to matters that are pertinent and important to fulfill the objectives of the entrusted work. Each level must establish procedures to guarantee that the work papers are safeguarded and preserved during the time established by the Law. In the course of said term, a new Internal Audit has not been executed, the working papers must be kept until it is executed, at which time it will be analyzed whether or not to keep all or part of them.and contain relevant information, that is, limit itself to matters that are pertinent and important to fulfill the objectives of the entrusted work. Each level must establish procedures to guarantee that the work papers are safeguarded and preserved during the time established by the Law. In the course of said term, a new Internal Audit has not been executed, the working papers must be kept until it is executed, at which time it will be analyzed whether or not to keep all or part of them.Each level must establish procedures to guarantee that the working papers are safeguarded and kept for the time established by the Law. If a new Internal Audit has not been carried out during said term, the working papers must be kept until it is completed. run, opportunity in which the convenience of keeping or not all or a part of these will be analyzed.Each level must establish procedures to guarantee that the working papers are safeguarded and kept for the time established by the Law. If a new Internal Audit has not been carried out during said term, the working papers must be kept until it is completed. run, opportunity in which the convenience of keeping or not all or a part of these will be analyzed.

Purposes of working papers

As an accumulation of all the evidence obtained during the course of the audit, the working papers have several functions. The main purposes of these are:

• Help organize and coordinate the many phases of the audit review. Provide information to be included in the audit report. Serve as support for the auditor's opinion.

The working papers also serve as evidence in case of legal claims, source of information for future declarations and other specialized reports requested by other competition bodies and as a guide for subsequent audit reviews.

Organization and coordination of the audit examination

Working papers are a means of organizing and coordinating the different phases of the audit as they take place. During the audit of a large entity, assistants can be assigned to the different phases of the review. The working papers are used to assure the auditor in charge that all the stages of the examination have been completed, which is why the completion of the examination is necessary, upon verification of the examination carried out. Auditors are often unable to complete an entire phase of the audit at a time and working papers record the work completed up to the point where it was interrupted so that they know where to continue their work, either by the auditor himself or by another if required by the situation presented. Also,These must always be in a condition for presentation to supervision or analysis before the auditee.

Information to include in the audit report

The working papers provide the information to be included in the auditor's report. The audit file is made up of the financial statements, accompanying notes and the auditor's opinion, shown in each working paper. The evidence in all its various forms constitutes the basis for the report, which is also filed in the File, with all the work papers prepared during the course of the Audit. If a special report is required, provided by the State Administration Agency (MAC), the data for any additional process, the checks on the examinations, findings, comments on non-compliance and recommendations, are contained in the working papers..

Support for the auditor's opinion

The ultimate objective of an audit is the expression of the auditor's opinion. Working papers serve to back it up. The auditor, when signing the report, affirms that the review was carried out in accordance with generally accepted auditing standards. Working papers should contain evidence that the work was properly planned and based on the review of internal controls, that the Auditors or Assistants were properly supervised, and that sufficient competent evidence was reviewed. The auditor is also asserting that the financial statements reasonably present the entity's situation, if it is a Financial Audit, and the results of operations in accordance with generally accepted accounting principles.The working papers must contain evidence that all important information in the statements was reviewed to determine that they reasonably present what has actually happened within the entity. In a large Auditors Unit the Director or Chief, who has responsibility for the audit, relies on supervisors, chiefs, auditors and assistants to carry out most of the review phases. The work papers must contain evidence of the work performed and the conclusions reached by each of these people, and also evidence that the work at each level was appropriately reviewed by the immediate supervisor.In a large Auditors Unit the Director or Chief, who has responsibility for the audit, relies on supervisors, chiefs, auditors and assistants to carry out most of the review phases. The work papers must contain evidence of the work performed and the conclusions reached by each of these people, and also evidence that the work at each level was appropriately reviewed by the immediate supervisor.In a large Auditors Unit the Director or Chief, who has responsibility for the audit, relies on supervisors, chiefs, auditors and assistants to carry out most of the review phases. The work papers must contain evidence of the work performed and the conclusions reached by each of these people, and also evidence that the work at each level was appropriately reviewed by the immediate supervisor.and also evidence that the work at each level was appropriately reviewed by the immediate supervisor.and also evidence that the work at each level was appropriately reviewed by the immediate supervisor.

Legal evidence

Working papers are a form of evidence that can be used in legal action. Auditors may need to use working papers to support their assertion that they performed the audit in a professional manner, exercised due care, and were not negligent in conducting the review. When reviewing the working papers prepared by the auditors, the Group Chief Auditor must at each level ask himself if any of the information that appears there or if the absence of any information could be used to attack the competition of the work at some later time where those people might not be available for further clarification. In the working papers there should be no contradictory statements,and any final conclusion that is opposed to other evidence, must be fully justified. In all doubtful matters there must be an adequate explanation for the conclusion reached.

Specialized reports

Another function of the working papers is to provide the necessary information for the preparation of reports to the administration on the adequacy of internal controls, or for the preparation of statements or reports to other government bodies. Sometimes auditees need information from working papers for the reports they prepare themselves, or they may need information because their original records have been destroyed.

Guidance for subsequent audits

Usually the auditor should review the previous audit working papers in the entity's File to carry out the current review. The working papers of the previous audit indicate the difficulties encountered and the solution that was given to them. Thus, the auditor is alert to the possibility of encountering a similar situation today. In addition, from the previous audit, the auditor must be familiar with the description of the accounting system and controls, in order to be aware of the changes that occur during the year and make the necessary modifications in the audit program. There is great danger in following too closely the working papers of the previous audit. The auditor will benefit from seeing the format of a particular analysis from the previous time,but you should only use that same format if it is suitable for the current situation. The duplication of the audit steps outlined in the working papers of the previous one may very well result in unnecessary and inappropriate steps, as well as the omission of some fundamental procedures for an adequate audit in the activities and events of the current one.

Ownership of working papers

The working papers prepared by the auditors are their property and the information they contain is generally considered confidential. Usually before giving information that appears in the work papers, the auditor obtains the consent of the auditee. If you receive a subpoena or injunction asking for information from the work papers, the auditor must deliver it. The auditor may also find it necessary to disclose some information even against the client's wishes in order to comply with auditing standards, as is the case in cases where facts that existed at the date of the auditor's report are subsequently discovered.

It is difficult to establish how long an auditor should keep working papers. You should retain them as they are important for subsequent audits and to meet any legal requirements. You must comply with the regulations that exist.

Types of working papers

Since working papers are the means of accumulating all the evidence the auditor needs to issue a professional opinion, the types of working papers necessarily have to be quite varied.

Some working papers follow a standard format, while others are a simple memorandum from a discussion that took place regarding the audit review. The main types of working papers are: 1) audit plans, 2) worksheet and adjustment entries, 3) Detail sheets, prepared to group accounts of a topic 4) descriptive summaries, for cases of financial audit or certification of financial statements 5) statements and confirmations, and 6) minutes and other records. Each working paper should be as complete as possible, and leave no doubts regarding the issue to which they relate. Each of the main types of job papers is described below.

Audit plans

The engagement papers should contain evidence that the auditor has developed an overall strategy for the conduct and scope of the review. Annotations should be made in relation to the activity in which the audited entity operates, conditions that require special audit procedures, any unusual accounting principles used, and the nature of any special reports that must be submitted. The audit program, a planning document that establishes the audit procedures that are estimated to be necessary to meet the audit objectives, can be supported by an internal control questionnaire, flow charts, an organization chart, and general evidence that helps to shape the course of the review.Working papers include annotations prepared during the examination on pending issues to be investigated later, along with a full explanation of the resolution of these issues, generally acquired and analyzed in the preliminary exploration.

Worksheet.

The trial balance is the connecting link between the accounting books and the financial statements on which the auditor issues his criteria. The worksheet is the control card that shows the interrelationships of all the other work papers related to the examined accounts, perhaps grouped, with the other types of evidence. This system of preparing and organizing the work papers showing a worksheet by groups of accounts of the balance sheet, an income statement worksheet, is important because they constitute an important work guide for the Auditor, since each of the items in these worksheets are analyzed in their corresponding work papers, sheets of 8 columns or more are generally used, the one that appears in the Institutional Stationery Manual.Usually for each set of working papers an index is prepared that clearly shows the location within the file of working papers by topics, foreseen in the planning, which must be organized, according to the criteria of the auditor, an important aspect when preparing the notes of the report, draft worksheet of the auditor's report, all the notes and other information collected as evidence, see “Standards” in chapter XIV of the Audit Manual.all notes and other information collected as evidence, see "Standards" in chapter XIV of the Audit Manual.all notes and other information collected as evidence, see "Standards" in chapter XIV of the Audit Manual.

Preparation of Work Papers

The working papers have to be headed according to their content, usually it is the head of the audit who heads them and in many cases it is he who begins the work on them to show his assistants how they should be carried out. Once the audit is completed, the working papers are arranged in the corresponding audit work file.

In order to prepare the work papers with the appropriate quality, so that they meet the necessary requirements, the following indications will be considered:

1. Put the heading at the top, located in the center or left side, depending on the type of paper used and the way it will be filed.

This heading will contain:

• Name of the Division, Management or of the agency object of the audit Name of the worksheet or objective, referring to the account or procedure that is reviewed Date or period that is reviewed, as the case may be, which may be in print or in number.

1. Use the identification stamp, in the upper right part, at the width of an 8.5-inch sheet, a place that will allow easy location of the worksheet. In cases where the worksheets are wider, they will be cut from that measurement, up to the level of the lower part of the heading, leaving the entire upper part of the sheet, Heading and Identification visible.

The identification stamp must contain the spaces of:

PT (Identifies the Job Paper that is enabled)

AUDITOR (Auditor's Initials)

DATE (Date the Job Paper is enabled)

1. Use the appropriate work paper for each issue, columnar paper (with 5 and 8 columns, those shown in the Institutional Stationery Manual), of statements, analysis, etc., lined paper, shown as PT: Note Sheets, in the Institutional Stationery Manual, or without lines, which can be used additionally to conclude checks of different work papers, according to the form of the work paper and that of its file, by means of the subject it deals with and the indicated number, in addition The half signature of the author and the date it was made. Do not write on both sides to facilitate handling and reading. Contain the summary of the results of the verifications carried out, at the bottom and if not possible, on the attached sheet. in each finding, as required by the regulations or procedure that is breached.The mathematical information it contains is correct. It is legible, clean and clear. Use adequate wording that allows any authorized person to have access to it and the interpretation of its content. Have the appropriate design in accordance with the objective being pursued and Other questions of form Markings, dashes and double dashes have been used correctly Worksheets are correctly folded Are properly preserved, in the Audit execution process Containing cross-references to the findings that are related to each other. Do not include notes or comments on different issues on the same sheet, using a sheet for each subject will not include analysis of different accounts, unless they have a very close relationship and complement each other.When they are objects of review, the review carried out must be recorded in them, by means of the signature of the person who carried it out and the date it was carried out.The auditor will always keep in mind that the content and order of the working papers reflect their degree of competence, experience and knowledge.When preparing the work papers corresponding to the Notes, you must use plaques as indentations, to identify the results of the checks by the results of the examinations from the different work papers, also reflecting the origin of these, as a cross-reference between these papers. In each Note Sheets work paper, the auditor must use a cross-reference with the results of the Report, this will facilitate the preparation of the same.The auditor will always keep in mind that the content and order of the working papers reflect their degree of competence, experience and knowledge.When preparing the working papers corresponding to the Notes, you must use plaques as indentation, to identify the results of the checks by the results of the examinations from the different work papers, also reflecting the origin of these, as a cross-reference between these papers. In each work paper Note Sheets, the auditor should use a cross-reference with the results of the Report, this will facilitate its preparation.The auditor will always keep in mind that the content and order of the working papers reflect their degree of competence, experience and knowledge.When preparing the working papers corresponding to the Notes, you must use plaques as indentation, to identify the results of the checks by the results of the examinations from the different work papers, also reflecting the origin of these, as a cross reference between these papers. In each work paper Note Sheets, the auditor should use a cross-reference with the results of the Report, this will facilitate its preparation.The auditor will always bear in mind that the content and order of the working papers reflect his degree of competence, experience and knowledge.When preparing the working papers corresponding to the Notes, he should use plaques as indentations, to identify the results of the checks by the results of the examinations from the different work papers, also reflecting the origin of these, as a cross reference between these papers.In each work paper Note Sheets, the auditor must use a cross reference with the results of the Report, this will facilitate preparing it.The auditor will always bear in mind that the content and order of the working papers reflect his degree of competence, experience and knowledge.When preparing the working papers corresponding to the Notes, he should use plaques as indentations, to identify the results of the checks by the results of the examinations from the different work papers, also reflecting the origin of these, as a cross reference between these papers.In each work paper Note Sheets, the auditor must use a cross reference with the results of the Report, this will facilitate preparing it.to identify the results of the checks by the results of the examinations from the different work papers, also reflecting the origin of these, as a cross reference between these papers In each work paper Note Sheets, the auditor must use cross reference With the results of the Report, this will facilitate its preparation.to identify the results of the checks by the results of the examinations from the different work papers, also reflecting the origin of these, as a cross reference between these papers In each work paper Note Sheets, the auditor must use cross reference With the results of the Report, this will facilitate its preparation.

Index and organization of the Work Papers.

The Auditor must indicate the Work Papers during the audit, since in this way it facilitates the search for any data or information that you want while the work is being carried out. These should be organized by Balance sheet accounts, which have been the object of checks and verifications, and at the end, place those working papers that are not directly linked to any of the accounting accounts or subjects that were examined.

The working papers must be indicated in the same order in which the accounts or groups of accounts appear in the Financial statements, first those of the Balance Sheet and then those of the Income Statement.

BG Balance Sheet

ER Income Statement

EC Statement of Cost of Production and Merchandise Sold

AJ Seats Settings

N Notes. (Includes all the Audit notes, arranged according to the alphabet used in their execution

AZ Accounts and Account Groups will be ordered according to the same file as the Note Papers, and the identification of the Topic letter and of course the corresponding numbering will be taken into account:

Example:

"PT: A-1

PT: A-1-1

PT: A-1-2, etc

PT: A-2

PT: A-2 ……

……. Et.

Next topic

"PT: B-1

PT: B-1-1

PT: B-2

PT: B-3

Etc.

All work papers related to an account or group of accounts, a Topic, must be assigned an order number starting with the letter A. After the number granted, a dash (-) will be placed and then the corresponding consecutive number to:

• Work papers corresponding to the group of accounts “Cash in Cash and Bank” will be numbered as “A” “Cash in Cash and Bank” the corresponding work papers will be numbered “A-1”, “A-2”, “A- 3 ”, And if an action needed a documentary support contained in the previous one, then an additional digit would be used to identify it without losing the identity of the action, then:

"Would be the letter, the first digit, and the second

Example

PT: A-1-1

• Work papers corresponding to the “Accounts Receivable” group of accounts, will be numbered with the corresponding number, say D and then after the sloping line, the consecutive number that corresponds to each of the work papers, “D -1 "," D-2 "," D-3 ", etc.

The work papers that do not correspond to an account must be classified and numbered according to the subject in question, following the same procedure as the one indicated above.

General working papers, that is, those that do not correspond to an accounting account or to any internal control issue, must be classified within an “Other” following the same numbering criteria listed above, if they were of another type of audit, will organize the corresponding topics and will assign in the same way a letter, and a number or several if it is necessary, and will indicate at the beginning to enable its search.

If after having numbered the working papers related to a certain topic, the need arises to file one or more that belong to the same topic and because the corresponding consecutive numbers are used, it is not possible to give them the corresponding numbering, the number will be assigned of the working paper whose subject is the most akin to the new or new ones that are required to be filed, adding to them after a period the corresponding consecutive number, example: "A-¿-", etc.

Requirements that must be observed in the preparation of the Work Papers

They must be made in such a way that they allow:

• The systematic review of the development of the audit work by the head of the group, supervisions or the head of the body, as appropriate. That other auditors can continue the work interrupted for any reason, by the auditors who initiated the audit. Obtain evidence of the significant conclusions and judgments that are issued in the audit reports by other auditors who have not had contact with the performed audit Provide sufficient information to the auditors who will carry out a new audit of the entity Allow the external auditors to review the same, either from state institutions or independent entities hired by the Corporation Other important requirements: Contain relevant, sufficient, competent and reasonable evidence of the verifications,Verifications and investigations carried out by the auditors and their results that support the judgments and conclusions that are formulated in the report, as well as the notes and observations written, that allow the preparation of the audit report, guaranteeing that at the time of preparing the report, no additional information is required.They must contain sufficient information that does not require additional explanations.They must be truthful and the calculations reflected in them must be exact.The objectives, scope, programs, guides and methodology used must be considered in them. audit, including methods and criteria used to determine the samples and obtain them. The origin or source of the information must be recorded so that the value of the evidence is fixed, in addition,The scope and limitations of the checks and investigations carried out must be reflected to indicate the degree of responsibility assumed by the auditor.They must be organized in such a way that the rapid location of any information contained in them must be paginated in such a way that when detailed in the Control Sheet of the Audit File, this works as an index.

Auditor Stamps

The stamps that have been enabled are the following:

• The identification stamp, whose objective is to facilitate the recognition of the working papers, by containing the number of the working paper (PT), a subject covered by it, while including the date and the average signature of the acting auditor that The corporate stamp, with the symbol of the Corporation, which has the objective that when it is reflected in the documents that are reviewed, it is evidence that this has been verified by the auditor.

Auditor Marks

They are the symbols used by the auditor in order to leave a reliable record of the acts performed; allowing other authorized officials to know what actions were carried out.

Auditors necessarily have to have an arsenal of pre-established markups that indicate the checks and verifications performed on books, forms and other documents they examine, as evidence developed by the auditor who acted.

The marks that will be indicated below are indicative, and the acting auditors may use those with which they are most familiar, but in this case it is mandatory to record the marks used and their significance in the working papers, to allow other auditors to recognize the type of verifications and verifications carried out by those who acted on the documents being verified. The brands indicated are the following:

It is mandatory to record in the P / T the marks that the auditor uses and their significance.

The following is a group of brands as an example of which the auditor can use.

Brand	Meaning
W	Verification of calculations and sums (accuracy of mathematical operations)
4	Checking annotation in documents and records. Checked the registered operation against the original documents.
OR	Examination of passing from one register to another.
or	Physical proof check.
TO	Submajor test against the control account. Checked against the balance of the major.
OR	Group leader checks.
>	Supervisor checks.
v	In addition to non-compliance with the rules of the current accounting manual in the books, records, forms and other accounting and administrative documents.
(/)	In cases where the auditor has any observation regarding the verification carried out, the symbol must be placed before the stamped mark.

Responsible: Group Leader and Auditors

Goals:

• Serve as a guide for the work, in which the auditors can consult and adapt to the conditions and characteristics of each entity Helps organize and coordinate the execution and review phases of the audit Provide information that serves as methodological preparation to all Accounting, Auditing and other administrative and technical professionals of the Corporation. Uniform the preparation of the working papers until they are filed in the Audit File. Fundamental element to summarize the opinion on the results of the audit and prepare the final Report.

Standards:

In the execution of the audit, various documents can be used to support examinations, checks, requests, verifications, samples, calculations, in short, they can be evidence prepared by the auditor, or supplied internally by the auditee or by a third party, so that its presentation may not be limited to a single style. However, standards have been established based on the need to standardize those prepared by the auditor, located in Chapter XII “Standards” of this Audit manual, and in the Institutional Stationery Manual, with the name of:

• Working Papers of 3, 5, and 8 Columns.Note Sheet "T" Accounts Documents of different transactions taken from the accounting and commercial systems established by the auditee to control and record the different economic facts of the entity.Documents necessary to support examinations carried out, prepared by the auditee Other documents prepared by the auditor in the performance of certain actions at different stages of the Audit.

Risks:

1. Failure to conduct the examination in accordance with generally accepted auditing standards Failure to assure the responsible and competent person about the reasonableness of different financial statements The auditor is not prepared to doubt the validity and completeness of the evidence. The sample taken is not sufficient to support the results of the examination carried out and the fulfillment of the programmed objectives. Failure to evaluate the evidence by applying reliable techniques that ensure its validity and reasonableness. Failure to identify the level of relative importance and probable risk of an evidence. The documentary evidence does not clearly express the objective of the scope of the checks carried out. The findings are not clearly defined and lack reasonableness to support the result of the examination,The conclusion and recommendation to demonstrate the nature and scope of the work carried out Not limited to matters that are relevant and important The checks and their results presented are not clear, understandable and detailed enough for a third party to be able to support conclusions and recommendations by review.

During Consulting engagements, internal auditors must consider the risk compatible with the objectives of the engagement and be alert to the existence of other significant risks, including:

• Detect an irregularity, and not follow the process to the end, including unsigned documents, unaccepted accounts, aging balances, there is a risk of not detecting the commission of a criminal act, conceive an action, and simply carry out the same, ignoring logical sequences of the investigation process, there is a risk of not detecting and exposing deficiencies

Internal auditors must incorporate the knowledge of risk obtained from Consulting work in the processes of identification, analysis and evaluation of significant risk exposures in the organization.

• A complex application system includes a large number of procedures that may not leave a complete trace, therefore errors in the logic of an application program can be difficult to detect in a timely manner by manual procedures.

Controls:

All work papers are subject to control, both by the group leader and acting supervisors, which can be carried out both at the stage of the audit execution, or after it is finished . They are filed in the Audit File as established in this Manual.

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