Every accountant knows what it feels like to chase down critical information via email, only to receive partial responses, or attachments that don’t quite match up.
It’s a vicious communication cycle, but it’s also one you can escape with a structured audit questionnaire. That way, you’ll be able to gather accurate information upfront and save everyone time and frustration.
In this post, we’ll walk you through the most important sections and questions of an audit questionnaire. Let’s take a look!
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30 questions to include in your audit questionnaire
You can add as many queries to the questionnaire as you see fit, but we’ll focus on the most important fields only. Here are 30 recommendations for a comprehensive audit questionnaire.
| Note: The screenshots you’ll see below come from Content Snare’s customisable audit questionnaire template. You can access it for free through our library of questionnaire templates. |
General client information
The purpose of this section is to gather background information about your client, including key contact points and general business structure.
1. Company name
2. Address
3. Contact points
This should include the names, emails, and phone numbers of key personnel involved in financial reporting.
4. What is the legal legal structure of your company?
This can be corporation, partnership, LLC, and so on.
5. What is your primary industry?
Kindly summarize the primary business activities and markets.
Financial statements and documentation
This set of questions should help you verify that the client has prepared and organized financial statements and all of the corresponding files.
6. Have you prepared the balance sheet, income statement, cash flow statement, and statement of shareholders’ equity?
If yes, please upload these documents.
7. Kindly upload other supporting documents for all major transactions.
These include invoices, contracts, and similar.
8. Have you made any adjustments to prior-period financial statements?
If so, provide details.
9. Are interim financial reports available?
If so, kindly upload these reports.
10. Please describe the internal process for preparing and reviewing financial statements before external review.
Revenue recognition and sales process
These questions assess your client’s revenue recognition policies and controls over sales transactions.
11. Kindly summarize the company’s policy for recognizing revenue, especially with regard to applicable accounting standards.
12. List the primary revenue sources and the percentage of total revenue each represents.
13. Describe the internal controls in place to monitor and record sales transactions.
14. Kindly outline your company’s policy on returns, refunds, and adjustments.
15. Are there any unrecorded or deferred revenue transactions?
If so, please provide details.
Accounts receivable and collections
The goal of this section is to properly evaluate the management and accuracy of accounts receivable.
16. Provide an aging schedule for accounts receivable.
For instance, these can be current, 30-60 days, 60-90 days, and over 90 days.
17. List and describe any significant write-offs of receivables in the past year.
18. Kindly describe the company’s collection practices and terms of credit.
19. Are there any large customers that constitute a significant portion of receivables?
If so, list these customers.
Inventory and Cost of Goods Sold (COGS)
This is a major aspect of the audit since you need to check inventory valuations, controls, and how COGS is calculated.
20. What is your method for inventory valuation?
For instance, this can be FIFO, LIFO, weighted average, or similar.
21. Does the company have a process for assessing and writing down obsolete inventory?
If so, please outline this process.
22. Describe your method for calculating COGS and any major adjustments made.
Liabilities and debt obligations
These questions focus on reviewing your client’s outstanding financial commitments. In addition, they will help you analyze the company’s compliance with loan covenants and identify any contingent liabilities that could impact its financial position.
23. Kindly provide an aging report of accounts payable.
24. Provide a list of all outstanding loans.
These include principal amounts, interest rates, and maturity dates.
25. Are there any loan covenants?
If so, kindly provide more details.
26. Outline major accrued liabilities such as accrued wages and taxes.
27. Kindly describe any contingent liabilities or potential legal claims.
Internal controls and fraud prevention
The last set of questions should help you assess the client’s internal controls over financial reporting and fraud prevention mechanisms.
28. Have you adequately segregated duties to reduce fraud risk?
One example is the separation of cash handling and recording functions.
29. Is there a formal process for employees to report suspected fraud?
If yes, kindly describe this process.
30. Does your company have an internal audit function?
If yes, list its primary responsibilities.
Tailor your audit questionnaire with Content Snare
Content Snare features an editable audit questionnaire template with all the questions listed above. You can use the template as-is, or adjust it to match your audit procedures.
What makes Content Snare so efficient is that it allows you to add easy-to-follow instructions to each page, section, or field. Instructions make it much easier for your clients to fill out the questionnaire and deliver the right documents. Here’s what one of our clients said after sending their first request:
Content Snare allows clients to write comments and ask questions for further clarification. It means you can help them out directly within forms to avoid misunderstandings.
The best part is that you can try it out, free of charge, by signing up for a 14-day trial. No strings attached, no credit card info required.