Another reminder for all of us from the California state law that applies to CPAs: There is a requirement for auditors to retain audit documentation for 7 years from report release date.
Here’s the state code from section 5097:
(d) Audit documentation shall be maintained by a licensee for the longer of the following:
(1) The minimum period of retention provided in subdivision (e).
(2) A period sufficient to satisfy professional standards and to comply with applicable laws and regulations.
(e) Audit documentation shall be maintained for a minimum of seven years which shall be extended during the pendency of any board investigation, disciplinary action, or legal action involving the licensee or the licensee’s firm. The board may adopt regulations to establish a different retention period for specific categories of audit documentation where the board finds that the nature of the documentation warrants it.
Regs from CBA clarify that the 7 year clock starts from report release date.
Oh, make sure your document retention and destruction policy is in writing. Also from section 5097:
(f) Licensees shall maintain a written documentation retention and destruction policy that shall set forth the licensee’s practices and procedures complying with this article.