What Must an Audit Engagement Contract Contain at a Minimum?

The minimum content of an audit engagement contract is set out in Article 29/1 of the Independent Audit Regulation. Accordingly, the written audit contract between the audit firm or the independent auditor undertaking the audit and the audited entity must contain at least the following:

a. For audits of capital companies subject to audit under the fourth paragraph of Article 397 of the Turkish Commercial Code, the date and number of the general assembly resolution or court decision on which the contract is based, and, for entities without a general assembly, the date and number of the resolution of the body authorised to elect the auditor,

b. The purpose, scope and period of the audit and any special reasons for it,

c. The subject matter and criteria of the audit,

d. The responsibilities of the parties,

e. A clause stating that the audit will be conducted and completed in accordance with the Turkish Standards on Auditing (TDS) and the relevant legislation,

f. A clause stating that unrestricted access will be provided to all records, documents and other information requested in connection with the audit,

g. The names and titles of the auditors in the audit team, including their substitutes, the planned working hours, a detailed breakdown of the fee considered appropriate for each, and the total audit fee,

h. A clause stating that the engagement partner and his or her substitute are authorised to sign the audit report on behalf of those undertaking the audit,

i. The start and end dates of the audit and the report delivery date,

j. A clause stating that professional liability insurance will be taken out,

k. That the audited entity is obliged to inform the auditor of events occurring after the report date but before the publication date of the financial statements or the annual activity report that would affect them,

l. A clause stating that the contract may be terminated only in accordance with the legislation.