As per NSA 580: Written Representations, the objective of the auditor is to obtain written representations from management and, where appropriate, those charged with governance that they believe that they have fulfilled their responsibility for the preparation of the financial statements and for the completeness of the information provided to the auditor
The auditor should obtain evidence that management acknowledges its responsibility for the fair presentation of the financial statements in accordance with the relevant financial reporting framework, and has approved the financial statements. The auditor can obtain evidence of management’s acknowledgement of such responsibility and approval from relevant minutes of meetings of the board of directors or similar body or obtaining a written representation from management or a signed copy of the financial statements.
The auditor should obtain written representations from management on matters material to the financial statements when sufficient appropriate audit evidence cannot reasonably be expected to exist. The possibility of misunderstandings between the auditor and management is reduced when oral representations are confirmed management in writing.
If a representation management is contradicted other audit evidence, the auditor should investigate the circumstances and, when necessary, reconsider the reliability of other representations made management. Also, the written representations cannot be regarded as the substitute for sufficient appropriate audit evidence.
The auditor would ordinarily include in audit working papers evidence of management’s representations in the form of a summary of oral discussions with management or written representations from management in the form of letter addressed to the auditor.