The Stock Confirmation Letter For Audit is a crucial document in South African audit procedures, required as part of the external audit process for companies maintaining significant inventory. This document is typically prepared at the request of external auditors during annual audits or special-purpose audits. It serves as formal confirmation of inventory details, including quantity, value, location, and ownership status, as of a specific date. The letter must comply with South African auditing standards, the Companies Act 71 of 2008, and International Standards on Auditing (ISA) requirements. It's particularly important for businesses with significant stock holdings and is often accompanied by detailed schedules of inventory. The document helps auditors verify the existence and valuation of inventory, which is often a material component of a company's financial statements.

1. Letterhead and Date: Company letterhead and current date

2. Addressee Details: Auditor's firm name, address, and relevant contact person

3. Reference Line: Audit reference number and period under review

4. Subject Line: Clear indication that this is a stock confirmation letter

5. Opening Statement: Confirmation of the purpose of the letter and response to the audit request

6. Stock Details: Confirmation of total stock value and reference date

7. Confirmation Statements: Specific confirmations about stock ownership, liens, and accuracy of information

8. Authorization: Signature block including name, position, and date