Client Substantiation File: Templates and checklists

Transcript of a video of Stuart Cormack describing the templates and checklists in our Client Substantiation File.

Title: Client Substantiation File: Templates and checklists

In this video, I’ll be talking about the templates and checklists we have developed. The templates have been developed to help with consistency.  You can help your auditor to be more efficient when the information you give us is provided in a way that is consistent with the way we construct our audit files.

I’m going to go into some detail about one of the templates that we have created, the lead schedule.

The lead schedule is a summary and index of the make-up of financial statement line items as well as the related note disclosures. The lead schedule shows which general ledger accounts are included in each financial statement line item and so ties the general ledger back to the financial statements. The lead schedule is also used to explain any significant movements between the current year and the prior year and budgeted amounts.

This information is important for both you and your auditor. It helps identify variances that are unexpected and could help to identify misstatements in your financial statements. This means when you are preparing your financial statements it will help make sure that the financial statements you are preparing are accurate.  This will also help your auditor as they can use this analysis as part of their risk assessment - and it  may help them identify areas they want to follow up on or focus on in their audit procedures.

The checklists are there to assist you in preparing documents that are error free. These checklists are high level but we hope will help you.

Next, I am going to explain one of the checklists that we have created, the financial statement checklist

This is a high-level checklist that you can use once you have completed your financial statements. It is there to help you make sure that your financial statements are free from basic errors. If your financial statements contain even small errors it means that your auditor has to take some more time to report these to you and you in turn have to correct them after which your auditor will have to take some more time perform their checks again on the financial statements. As you can tell this process can take up valuable time and contribute to inefficiencies in the audit process.

Please now have a look at the Client Substantiation File templates and checklists.  We hope that you will find these useful as you prepare your financial statements.

Title: Visit to find out more about the Client Substantiation File.