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Unformatted text preview: ance with approved Auditing Standards and Guidelines and such control procedures are consistently adhered to by the member firm. The following six (6) key controls are included in the Questionnaire: - Audit File Administration Financial Statements Presentation Review and Evaluation of System of Internal Controls Substantive Tests Audit Conclusion 169 By-Laws (On Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants [Issued January 2007] APPENDICES APPENDIX VII - Audit Report Substantive approach - audit engagements A substantive approach will be employed if the reviewer chooses not to place reliance on the member firm’s specific controls on audit engagements or is of the opinion that the standard of compliance is not satisfactory. This approach requires a detailed review of the audit working papers in order to establish whether the audit work has been carried out in accordance with approved Auditing Standards and Guidelines. Such a review is similar to the type of review performed by the engagement partner/manager during normal audit engagement procedures. This approach is likely to take longer than the compliance approach. Closing meeting At the end of the on-site review, the factual findings will be discussed with the designated partner of the firm being reviewed or the sole practitioner. During the closing meeting, the designated partner/practitioner has the opportunity to make representations, suggestions and recommendations in relation to the matters raised. The reviewer has the duty of explaining to the designated partner/practitioner the advantages and benefits of implementing suggestions and recommendations for improvements. Reporting The reviewer will prepare a report to the Practice Review Committee (the reviewer’s report), incorporating the report of factual findings as discussed with the member firm. After review by the Practice Review Director (or Senior Manager) of the Institute, a dated draft of the reviewer’s report will be sent to the member firm for comments. This process should not take more than two (2) months after the closing meeting. Any comments made must be submitted in writing within twenty-one (21) days. The reviewer will finalise his/her report upon the receipt of the submissions. In finalising the report, the reviewer may make changes to the dated draft he/she considers appropriate in light of the submissions. The submissions will be attached (after properly codified) to the reviewer’s report before it is sent to the Committee for consideration. The member firm will be allowed the opportunity to make its representations throughout the review process. It is expected that the on-site closing meeting between the reviewer and the firm will provide an excellent channel for the communication of views concerning the findings and recommendations. In addition, the member firm has twenty-one (21) days to consider the dated draft report and make its formal submissions and representations to th...
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