The

Annual Audit

Tune-Up

By Douglas R. Carmichael

Audit tools must be updated
for the coming busy season.In Brief

That Time of Year Again

SAS No. 82 mandates many changes that will require extensive revision of firm audit policies and related generalized forms, checklists, and correspondence prior to the calendar year 1997 audit busy season. Engagement letters, management representation letters, and internal control documentation will require changes. In addition, new policies and forms will be needed to document compliance with new requirements related to fraud detection.

There are, however, significant opportunities for cost savings and efficiencies by implementing a coordinated approach to changing these materials and by early adoption of new SASs requiring additional changes to engagement and representation letters. Also, early discussion with senior management of the need to refer explicitly to "fraud" in correspondence such as engagement and representation letters is needed to avoid surprise and needless adverse reaction.

Accompanying the article is a table of recent accounting and auditing pronouncements having current and future effective dates. The table also appears on the Journal's home page www.cpaj.com.