Document background
An Audit Engagement Letter For Non Profit Organization is a crucial document required when establishing a professional relationship between an audit firm and a non-profit entity in Hong Kong. This document is mandatory under Hong Kong Standards on Auditing (HKSA 210) and must be in place before commencing any audit work. It sets out the fundamental terms of the engagement, including the scope of the audit, respective responsibilities, reporting requirements, and fee arrangements. The letter must address specific considerations for non-profit organizations, such as their unique regulatory requirements under Hong Kong law, including compliance with the Companies Ordinance (Cap. 622) and tax exemption status under Section 88 of the Inland Revenue Ordinance. This document serves as the primary reference point for the audit engagement and helps prevent misunderstandings between the parties regarding the nature and limitations of the audit services.
