Acronyms for Auditors and How to Use Them

Even though auditors spend hours every day staring at spreadsheets, they still do a good bit of writing. Over the years auditors have developed acronyms to facilitate communication regarding auditing and accounting terms. While you might not be abbreviating your language every time you write some of these phrases, it's important for you to know what these acronyms mean and how you can use them in the professional setting. Let's take a look at some important acronyms for auditors: 

PFI / PFW / PFA / NFWDN

Pass on further investigation

Pass on further work

Pass on further analysis

No further work deemed necessary

These are all grouped together because they effectively say the same thing, "we're done here." The best use of this language generally comes after a well thought out assessment in a work paper. When using these abbreviations, the auditor is saying that because this much has already been done, or the account is small or low risk, that there isn't enough to warrant further procedures and it's okay to move on to the next area. A trick that I use when using these abbreviations is to always preface it with a statement that contains "therefore." For example: we had examined the account balance and tested items such that the untested balances below tolerable misstatement. Therefore, NFWDN." 

PDW

Per discussion with

This is one of the most used abbreviations in auditing. It's meant to shorthand discussions had with client personnel. The important thing to remember is that getting information directly from client personnel and documenting who it came from is a very effective way to answer questions from your manager like "How do you know this?" Or "where is this information coming from?" If you perform both financial statement audits and financial statement reviews, expect to use this one a lot.

SALY / CWPY

Same as last year

Consistent with prior year

This is both the most useful and the most harmful item on this list. When clients have steady operations and you have a good understanding of why everything should be consistent, doing things the same as last year can save a lot of time. In fact, new auditors gain their skills from referencing prior year work papers. The problem arises when people copy last year without critically thinking about what's going on in the current year. There are times where you should not expect things to be consistent with the prior year, so be wary before going to SALY!

As your progress further into your professional career, you will learn more acronyms to use, but these are the most important ones that every auditor should learn starting out. What’s more important than knowing what the acronym stands for is knowing what they represent when put to use. These phrases have been turned into acronyms for a reason, not just because the phrases can be long to write out, but because those phrases are very common while performing audit procedures. So it’s not enough to just know what they stand for (although, that’s a good starting point for many), you need to learn when it is appropriate to use each.