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Question
We are switching audit firms. The previous firm says it will charge a considerable fee for the new firm to review their work papers. Is this customary? My experience has been that the sharing of workpapers is a professional courtesy.
Dear Jackie,
Thank you for contacting me.
I apologize for not providing you with a response sooner.
Communications between predecessor and successor auditors are regulated by the AU 315 Paragraph 11 which states that the successor auditor should request that the client authorize the predecessor to allow a review of the predecessor's working papers. The predecessor auditor may wish to request a consent and acknowledgment letter from the client to document this authorization in an effort to reduce misunderstandings about the scope of communications being authorized. It is customary in such circumstances for the predecessor auditor to make himself or herself available to the successor auditor and make available for review certain of the workpapers. The predecessor auditor should determine which working papers are to be made available for review and which may be copied. The predecessor auditor should ordinarily permit the successor auditor to review working papers including including documentation of planning, internal control, audit results, and other matters of continuing accounting and auditing significance, such as the working paper analysis of balance sheet accounts, and those relating to contingencies. Also the predecessor auditor should reach an understanding with the successor auditor as to the use of the working papers. The extent, if any, to which a predecessor auditor permits access to the working papers is a matter of judgment.
In brief, as stated above, both predecessor and successor should use good judgment in reaching an understanding with respect to access to working papers and related matters.
Other useful sources are SAS 84 and SAS 93.
Hope it helps.
I wish you continued success.
Sincerely,
Consuelo Herrera, CAMS, CFE
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Consuelo Herrera, International Accountant and Fraud Examiner
Expertise
I can answer questions concerning internal and operational auditing, fraud prevention procedures, internal control, the Sarbanes-Oxley Act, COSO control concepts, and management oriented auditing. I would love to provide business-owners with suggestions on how to prevent and detect fraud so that they are proactive in protecting their wealth since the very beginning of their entrepreneurial affairs. I can answer questions to both English and Spanish population. I am very committed to keep my standards up today so I know many resources where I can direct those seeking advice.
Experience
I have rendered services for private companies, profit and non for profit, in two countries. As independent consultant I have provided advice to managers in implementing procedures that streamline their operations and enhance their activities. As a staff accountant in a US CPA firm, I performed regular auditing procedures for different engagements.
Organizations
AICPA (American Association of Certified Public Accountants), ACFE (Association of Certified Fraud Examiners), ACFEI (American College of Forensic Examiners.
Education/Credentials
Bachelors of Sciences in Business Administration – Accounting
University of South Florida USF – Tampa Florida
Catholic University – Colombia
Title earned: Specialist in Tax and Customs
Central Foundation University – Colombia
Title earned: Certified Public Accountant.
On August, 2006 I passed all four sections of the Certified Fraud Exam which tests for proficiency in the following areas: Criminology and Ethics, Financial Transactions, Legal Elements of Fraud, and Fraud Investigation.
Awards and Honors
As employee of Forensic Technology Inc. a Canadian company with locations and sites worldwide, I was the winner of the 2005 President's award in the category of Cost Savings through Efficiency or Innovation granted in January 2006 in Montreal, Canada.
Past/Present Clients
I have provided advice to all kind of companies: manufacturing, service, consulting, non for profit organizations, etc.
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