The R2 Audit Orion Checklist

Orion provides essential guidance and support through every stage of certification, from audit to meeting all applicable regulations.

Sustainable Electronics Recycling International (SERI) still requires an on-site Stage 2 review as part of their recertification year, which occurs every three years.

Scope of the Audit
At the outset of an audit, its scope should be established according to an objective outlined in an audit plan (OAG Audit 4020: Developing the Audit Strategy: Audit Planning Document). Both auditor and auditee should have clear understandings as to what falls under its scope; without documented criteria in place it can easily lead to disputes between parties involved.

Clarifying the scope of an audit is key to cutting costs, increasing effectiveness and efficiency, and mitigating unnecessary risk. If an audit’s goal is to detect fraud, for example, then more time and examination will need to be spent reviewing records related to any processes which might have led to it than would be needed for simply complying with policies.

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Audit Procedure
Audit procedures involve collecting evidence for an audit. They involve inspection, observation, external verification and tracing. An important aspect of an audit procedure is collecting evidence in order to detect misstatements; verifying calculations are using correct data; detecting irregularities that deviate from industry averages as well as any unusual fluctuations or errors within a system; as well as identify any discrepancies within those systems that need further analysis by auditors.

Procedure is the set of steps used by auditors to systematically collect enough appropriate audit evidence in order to form their opinion. It is the auditor’s duty to design and conduct such procedures to secure this evidence – this includes information supporting and refuting management’s assertions about financial statements or internal control over financial reporting as well as anything which might contradict those assertions.

An auditor will review any documentation to assess its authenticity, as well as revising audit procedures if conditions arise that might compromise its reliability as evidence.

Audit Documents
Documentation can assist auditors in many ways. It helps with effective planning of audits and in creating procedures to ensure systematic execution. Documents also serve to demonstrate compliance with professional standards as well as legal or regulatory requirements, and aid internal teams (QC, peer review) or external bodies performing reviews or inspections of them.

Documentation should be thorough, providing clear details about the evidence obtained, the accounting records that supported its analysis, significant judgments made and conclusions drawn by auditors, as well as any significant decisions or recommendations they issued. Furthermore, its structure should make it easy for an experienced auditor to comprehend the scope, timing, extent and results of audit procedures performed.

Exceptionally, should it become necessary to add information to audit working papers after the release of an audit report, this must be recorded along with its justification and date of incorporation into documents.

Audit Report
An audit report is the document which communicates an auditor’s assessment of financial documentation submitted. A clean or unqualified opinion is considered ideal as this indicates no issues with what has been presented by a company to an auditor; otherwise, if their report qualifies, that may indicate they did not adhere to UK GAAP standards; an additional section in their audit report will address why their opinion could not be classified as unqualified.

Critical Audit Matter Section, created as an additional way of providing more information about a company, may also feature within an auditor’s audit report. Should circumstances become so dire that an opinion cannot be rendered, an disclaimer of opinion paragraph should appear after opinion paragraph and state the primary reasons behind its presence.