Engagement Letter For Internal Audit
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FAQ
What to include in an audit engagement letter The auditor's responsibilities include: ... The management's responsibilities include: ... The relevant financial reporting framework. ... The objective and scope of the audit engagement. ... Estimated fee and billing schedule. ... Type and scope of the audit report to be issued.
The internal audit engagement letter states the nature of the audit. It provides notice and scope of the upcoming audit. The auditor provides this to the auditee (could be a client) prior to the audit. The letter prevents surprise reaction from the clients.
The engagement letter should cover: the engagement's purpose; precisely what the firm will and won't do (the project scope); duties of the client; known unfavorable situations; rates and estimations of billing; client's signature;
When your firm is hired to perform an audit engagement, you need to have an audit engagement letter drafted and here's why: Prevents scope creep by outlining the scope of the engagement.
The engagement letter documents and confirms the auditor's acceptance of the appointment, the objective and scope of the audit, the extent of the auditor's responsibilities to the client and the form of any reports. Agreement on Written Representations.
