Audit Firm Name
Certified Public
Accountants
Street Address
City
ABC Inc.
Street Address
City
Date
Dear sir/Madam
The purpose of this letter is to set up
the basis of our operation as the auditors of ABC Inc. It also meant to outline
the responsibilities of the company as well as ours in our capacity as the
auditors.
This letter and appendices shall apply
in respect of the statutory audit and services for the year ended 31/12/2017
and subsequent periods unless stated otherwise in writing.
Audit
Services
the Auditor will provide
As the auditors of ABC Inc we have a
statutory responsibility to report whether in our professional opinion the
financial statements of ABC Inc give a true and fair view of the company affairs
and whether they comply with the company Acts. We are going to consider the
following matters in arriving in our decision.
a)
Whether
ABC Inc keeps a proper accounting record.
b)
Whether
the income statement and statement of financial position are in agreement with
accounting records and returns.
c)
Whether
we obtain all information that we consider necessary for a proper audit.
d)
Whether
the statement in the directors’ report is consistent with the audited financial
statements.
Audit
Objectives
This letter is to confirm our acceptance
as the auditors of ABC Inc. We have been asked to audit the financial
statements with an objective of expressing an opinion on the same. We shall
also obtain an understanding of ABC Inc’s internal control and accounting
system to aid us with the same.
Audit
procedures to be performed
1.
The
nature and extent of our tests will vary according to our assessment of the
company’s accounting and internal control systems, and may cover any aspects of
the company’s operations that we consider appropriate.
2.
In
addition to our report on the financial statements, we expect to provide you
with a separate letter concerning any material weaknesses in accounting and
internal control systems that come to our notice.
3.
We
will plan our audit so that we have a reasonable expectation of detecting
material misstatements in the accounts resulting from irregularities, fraud or
non-compliance with law or regulations, but our examination should not be
relied on to disclose all such material misstatements or fraud, errors or
instances of non-compliance as may exist.
Management
Responsibilities
Our audit will be conducted on the basis
that the directors and those charged with governance understand that they have
the following responsibility to.
a)
Maintain
proper accounting records and prepare financial statements which give a true
and fair view and comply with the company act.
b)
Prepare
financial statements which give a fair view of the company affairs and status
in accordance with international accounting standards, international accounting
reporting standards and generally accepted accounting principles.
c)
To
have internal controls in place to ensure that the financial statements are
prepared in an environment that will ensure they are free from material
misstatements.
d)
Provide
us with
i.
Access
to the company accounting records and information that is relevant in the
preparation of the financial statements which include but not limited to
records and documentations.
ii.
Additional
information that might be requested.
iii.
Unrestricted
access to persons within ABC Inc from whom we determine necessary to obtain
audit evidence from.
Timing
and Fees
The audit will be contacted from the
commencement date as agreed in this document till 3/4/2008. The agreed audit
fee is $5,000 for the whole process. The management will also cater for any
expenses that will be incurred during the performance of the audit work.
Agreement
of terms
If this letter correctly expresses your
understanding please sign the enclosed copy where indicated and return a copy
to us.
Yours faithfully,
____________________
We agree on the terms of this letter
___________________
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