How to Comply With Sarbanes-Oxley Section 404: Assessing the Effectiveness of Internal Control

5.6. COORDINATING WITH THE INDEPENDENT AUDITORS

Early in this phase of the project, you will want to coordinate your efforts with the client's independent auditors. Before proceeding too far, you should reach consensus on significant matters such as:

• The criteria you will use to determine whether documentation is sufficient

• In general, what the documentation will contain

• The process you will follow for gathering and assessing documentation

• Plans for addressing documentation deficiencies

The form and content of an entity's documentation of internal control can vary greatly. For that reason, you also should work with the independent auditors to develop a process that allows them to review documentation periodically, as you determine it is adequate. For example, you may wish to pilot test the documentation of significant activity-level processes and controls and provide this example documentation to the auditors as soon as it becomes available. Providing them with examples of actual documentation will help you reach a consensus quicker on what should be documented.