The preparation of audit documentation is an integral part of an auditors examination of financial statements. On a recurring engagement, auditors review the audit plans and audit documentation from the prior year to determine their usefulness for the current-year work.

Required:

a. (1) What are the purposes or functions of audit documentation?

(2) What records may be included in audit documentation?

b. What factors affect the auditors judgement of the type and content of the audit documentation for a particular engagement?

c. What should be included in audit documentation to support auditors compliance with GAAS?

d. How can auditors make the mot effective use of the prior-year audit plans in a recurring audit?