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External Audit Engagement Letter Template for Saudi Arabia

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Key Requirements PROMPT example:

External Audit Engagement Letter

"I need an External Audit Engagement Letter for my privately-held manufacturing company in Riyadh, with special consideration for our international subsidiaries in UAE and Kuwait, targeting audit completion by March 2025."

Document background
The External Audit Engagement Letter is a crucial document required before commencing any statutory audit in Saudi Arabia. It serves as the formal contract between the audit firm and the client company, establishing the foundation for the audit relationship and documenting the agreed-upon terms of the engagement. This document must comply with the requirements of the Saudi Organization for Chartered and Professional Accountants (SOCPA), International Standards on Auditing as adopted in Saudi Arabia, and where applicable, additional regulations from the Capital Market Authority. The letter addresses essential elements including audit scope, responsibilities, reporting requirements, timelines, and fees, while considering specific Saudi regulatory requirements such as Zakat reporting and local corporate governance standards.
Suggested Sections

1. Addressing and Date: Formal letter heading with recipient's details, including company name, address, and date

2. Introduction: Opening paragraph identifying the purpose of the letter and confirmation of the appointment

3. Scope of Audit: Detailed description of the audit scope, including the financial statements to be audited and the applicable financial reporting framework (IFRS as adopted in Saudi Arabia)

4. Auditor's Responsibilities: Description of the auditor's responsibilities, including conducting the audit in accordance with ISAs as adopted by SOCPA

5. Management's Responsibilities: Outline of management's responsibilities regarding financial statements preparation, internal controls, and providing access to information

6. Reporting Requirements: Description of the expected form and content of the auditor's report

7. Timeline and Deadlines: Expected timeline for the audit process and reporting deadlines

8. Fees and Payment Terms: Details of audit fees, payment schedule, and any additional costs

9. Independence Declaration: Statement confirming the audit firm's independence in accordance with SOCPA requirements

10. Acceptance Terms: Instructions for accepting the engagement and returning signed copies

Optional Sections

1. Group Audit Considerations: Required when the entity is part of a group and there are specific considerations regarding group audit requirements

2. Regulatory Compliance: Additional section needed for listed companies to address CMA requirements

3. IT Systems Access: Required when specific IT system access or digital audit procedures need to be outlined

4. Other Services: Include when additional non-audit services are being proposed, ensuring compliance with independence requirements

5. FATCA Compliance: Required for financial institutions or entities subject to FATCA reporting

6. Zakat Considerations: Include for entities subject to Zakat reporting requirements

Suggested Schedules

1. Appendix A - Engagement Team: Details of key team members and their roles in the audit

2. Appendix B - Fee Schedule: Detailed breakdown of fees, including hourly rates and estimated hours

3. Appendix C - Timeline: Detailed audit timeline with key milestones and deadlines

4. Appendix D - Required Information: List of documents and information required from the client

5. Appendix E - Standard Terms and Conditions: Detailed terms and conditions including liability limitations and dispute resolution

6. Appendix F - Independence Confirmations: Detailed independence declarations and any safeguards in place

Authors

Alex Denne

Head of Growth (Open Source Law) @ 黑料视频 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions



































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Relevant Industries

Financial Services

Manufacturing

Retail

Technology

Healthcare

Real Estate

Energy

Transportation

Telecommunications

Construction

Education

Professional Services

Mining

Agriculture

Hospitality

Relevant Teams

Finance

Accounting

Internal Audit

Compliance

Risk Management

Treasury

Legal

Corporate Governance

Executive Management

Board of Directors

Audit Committee

Relevant Roles

Chief Financial Officer

Financial Controller

Finance Director

Chief Executive Officer

Board Chairman

Audit Committee Chairman

Company Secretary

Treasury Manager

Financial Reporting Manager

Internal Audit Manager

Compliance Officer

Risk Manager

Managing Director

Finance Manager

Accounts Manager

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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