Following are several statements regarding accounting records or audit documentation. Which of the statements is correct?
A)Accounting records belong to the auditee.
B)Documentation of an auditor's understanding of the entity's internal control system is not necessary.
C)Audit documents may be regarded as a substitute for the company's accounting records.
D)The independent auditor may discard audit documents after two years.

Question

Quizplus · Accepted Answer

Accounting records belong to the auditee and are the property of the organization. The auditor has the right to access them in relation to the audit, but does not own them. B is incorrect as documentation of the auditor's understanding of internal control system is necessary. C is incorrect as audit documents are not a substitute for company's accounting records. D is incorrect as the independent auditor is required to retain audit documents for a minimum of five to seven years.

Following Are Several Statements Regarding Accounting Records or Audit Documentation