Drafting and approving the auditor's report
How the auditor's report is drafted on ISA 700-series wording in Achekam, who approves and issues it, and the matters approval does not check.
By Achekam · · 4 min read · For Accountants & audit firms in South Africa, Nigeria, Kenya
The auditor's report is the shortest document in the audit file and the only one most readers will ever see. It is also where small drafting accidents become public: a placeholder left in square brackets, the wrong framework named, a basis-for-opinion paragraph copied from another client. Partners know this, which is why the report is usually reviewed line by line at the end, often late at night.
Achekam takes some of that risk away through how the report is drafted and approved, and leaves some of it firmly with the partner. This article explains both, so that a partner knows exactly what the approval button has and has not checked.
Drafting from the standard wording
Under Audit & Assurance, Audit Reports, the engagement team drafts the auditor's report on standard wording drawn from ISA 700, 705, 706 and 701. The opinion can be unmodified, qualified, adverse or a disclaimer, with the paragraphs that each requires: the basis for opinion, emphasis of matter or other matter paragraphs where the team uses them, and key audit matters where they apply. ACCA's article on the auditor's report explains the elements of the report under ISA 700, key audit matters under ISA 701, modified opinions and Emphasis of Matter paragraphs.
The default wording is South African. On a Nigerian or Kenyan engagement the draft uses that country's legal wording instead, citing CAMA 2020 and the FRC Act in Nigeria or the Companies Act 2015 in Kenya. In every case the partner owns the final text. Standard wording is a starting point, not a substitute for reading the draft against the conclusions on the file.
Placeholders stop approval
Approval is refused while any [bracketed] placeholder remains in the draft. It sounds minor. It is also the kind of error that is painful to explain once a report is public, and it is caught before the report can move on rather than by the client's company secretary.
Only the engagement partner approves
Only the engagement partner approves the auditor's report. The partner may approve with working papers still open by recording a reason, which reflects the reality that some housekeeping is finished after the opinion is settled. There is one thing the partner cannot get past: where an engagement quality reviewer has been named, that person must clear the report before it can be issued, and that clearance cannot be bypassed.
What approval does not check
Here is where the partner needs to be precise about the limits.
Practitioner eligibility differs by country. For a South African firm, Achekam does not check the practitioner credentials register when a partner approves an audit report or signs financial statements; signing needs only the Partner role. For a Nigerian firm, Achekam blocks approving or issuing an audit report until a second person has verified the firm's FRC register entry and the signing partner's FRC number, ICAN or ANAN standing and signing authority. Achekam does not send the FRC Rule 14 e-mail: the auditor sends it and records it with evidence, and signing stays blocked until it is recorded. For a Kenyan firm, signing is blocked until the signing partner's ICPAK practising certificate and annual licence are verified as valid on the signing date.
Open consultations. An open consultation or difference of opinion does not stop the auditor's report from being approved or signed. The partner, or the quality reviewer, has to check the consultation records by hand.
Uncorrected misstatements. The completion Summary of Uncorrected Misstatements stays empty, because no screen or route writes to the misstatement register it reads. The evaluation of uncorrected misstatements under ISA 450, and their effect on the opinion, must be documented on a working paper of the team's own, and the partner should read that paper before approving.
| Country | What Achekam requires before the report goes out |
|---|---|
| South Africa | The Partner role; credentials register not checked |
| Nigeria | Second-person verification of FRC register entry, FRC number, ICAN or ANAN standing and signing authority; FRC Rule 14 e-mail recorded with evidence |
| Kenya | Signing partner's ICPAK practising certificate and annual licence verified as valid on the signing date |
| All three | No bracketed placeholders; the engagement partner's approval; a named quality reviewer's clearance |
Preview, signature and issue
Three steps take the report out to the client.
- Preview for the client. While the draft is settling, the partner can send the client a read-and-comment preview link to the audit report. The client opens it without signing in; the link expires and can be revoked. This is the place for those charged with governance to raise factual points before the report is final, not a negotiation of the opinion.
- E-signature. The partner can send the approved report for e-signature.
- Record as issued. Recording the report as issued binds the statements' fingerprint, so the report is tied to the exact set of financial statements it relates to, and starts the file-assembly clock.
That last step moves the engagement into its closing phase, described in locking the audit file and building the archive.
A partner's approval checklist
- The opinion type matches the conclusions on the file, and the basis-for-opinion paragraph says why.
- Every key audit matter, emphasis of matter and other matter paragraph is supported by a working paper.
- The working paper evaluating uncorrected misstatements has been read.
- No consultation or difference of opinion on the engagement is still open.
- A named quality reviewer has cleared the report.
- For South Africa, you have satisfied yourself of your own registration, since the system checks only your role.
- The evidence from external confirmations and component auditors is complete; see external confirmations and component auditors by link.
One habit worth changing
Send the client preview link as soon as the draft is stable, not on the day of signing. Comments that arrive early can be dealt with calmly; the same comments on signing day are how mistakes reach the final report.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
